RE/MAX: Home Sales Down as Prices Level Out

RE/MAX, Denver, said its August National Housing Report showed home sales fell despite slowing home price acceleration and persistently low inventories.

The report said home prices rose by 3.7% from a year ago, down somewhat from last month’s annual pace (5.4%), a trend that’s continued for the past three months; The median sales price ($248,500) marked the 29th consecutive month of year-over-year price increases.

The report noted though active inventory dropped for the 118th consecutive month, the decline of 5.4% from a year ago marked the smallest year-over-year decrease since August 2014. In addition, the August 2018 inventory drop marked the fourth consecutive month in 2018 to post single-digit percent declines, rather than the double-digit monthly drops consistently seen in early 2018 and over the previous three years.

“It varies by market, but we’re hearing that buyers are being more selective and sellers are becoming more pragmatic,” said RE/MAX CEO Adam Contos. “That dynamic could bring inventory levels up, especially in the most overheated markets, where we expect to see the clearest signs of equilibrium returning.”

Contos added that “the economy is strong and potential buyers are out there–they just need more listings, at the right price points, to consider. We believe that balance will return, which will be good for everyone in the long run. It’s just a matter of when.”

Key report highlights:

–Of 54 metro areas surveyed in August, overall average number of home sales fell by 0.4% compared from July and decreased by 1.1% from a year ago. Twenty-two metro areas experienced increases in sales year-over-year including, Houston, 34.2%; Burlington, Vt., 11.5%; New Orleans, 10.7%; and Tulsa, Okla., 10.5%.

–Only four metro areas saw year-over-year decreases in median sales prices, including Trenton, N.J., -1.9%; Little Rock, Ark., -1.1%; Burlington, -0.3%; and Birmingham, Ala., -0.03%. Three metro areas increased year-over-year by double-digit percentages, with the largest increases seen in Boise, Idaho, 16.8%; San Francisco, 11.7%; and Augusta, Maine, 10.2%.

–Average days on market for homes sold in August rose to 43, up two days from July but down four days from a year ago. Metros with the lowest days on market were Omaha, Neb. (21); Seattle (23); and San Francisco, Denver and Cincinnati, Ohio with 25. Highest days on market averages were in Augusta (91); Miami (78); Hartford, Conn. (77); and Manhattan (65).

–Number of homes for sale in August fell by 1.0% from July and by 5.4% from a year ago. Months’ supply increased to 3.0 in August from 2.9 in July and decreased from a year ago (3.1). Every metro but Miami reported a months’ supply at or less than 6.0; markets with the lowest months’ supply were San Francisco (1.4); Boise (1.6); Denver (1.7); and Salt Lake City (1.8).