RE/MAX: June Home Sales Amid Strong Home Buyer Demand
Despite record low inventories, RE/MAX, Denver said June home sales posted a solid 37 percent gain as more states loosened stay-at-home mandates stemming from the coronavirus pandemic.
The company’s monthly National Housing Report said home sales returned to near seasonal levels – just 6.9% lower than last June, which was the third-highest sales month of 2019. All of the report’s 53 metro markets posted gains over May, and a third of them topped last June, led by Tulsa, Okla. At 15.9%, Little Rock, Ak. at 14.6% and Dallas/Ft. Worth at 9.3%.
“June home sales snapped back in a major way,” said Adam Contos, RE/MAX Holdings CEO. “With historically low interest rates, stabilizing unemployment and increased mobility tied to working remotely, buyer demand remains high in most areas of the country. We’re seeing positives in several leading indicators such as pending sales and mortgage applications.”
A potential headwind, however, is available housing supply. RE/MAX reported inventory dropped 27.9% year over year, pushing the months’ supply to 1.9 from the previous report low of 2.7 months set in May. The number of homes for sale is at lows not seen consistently since early 2018.
“The biggest challenge continues to be lack of inventory, and over time we may see some gains around people wanting a different living environment after spending so much time at home this year,” Contos said. “There’s also some potential in the idea that with changing workplace dynamics, underused commercial spaces could be transformed into residential properties. Creative solutions like that may provide some relief for inventory constraints as well as affordability issues.”
The median price of all 53 metros rose to $275,000 in June, up 0.8% from May and up 1.9% from a year ago. While there was an increase in price, June saw the lowest year-over-year price change of any month since December 2018’s 0.4% drop. Only one metro area, Des Moines, Iowa at -1.3%, saw a year-over-year decrease. Two metro areas increased year-over-year by double-digit percentages: Miami at 11.1% and Indianapolis at 10.0%.
