Housing market moves toward balance between sellers, buyers: Remax
The slowdown in home sales activity during August is more than just the normal seasonal lull and could mark the start of the housing market rebalancing, according to Remax.
While the median home price increased 3.7% year-over-year in August, it marked three consecutive months where the rise was lower than for the same month in 2017 compared with 2016.
Meanwhile, for the sixth time year, the month's home sales lagged behind 2017's pace. August's sales were down 1.1% compared with the same month one year prior.
August's median sales price of $248,500 was the 29th consecutive month of year-over-year price increases. But the dollar amount has been slipping on a month-to-month basis since peaking at a record high of $258,500 in June. In July the median price was $250,575.
"The moderation we are experiencing seems to be a bit more than the normal seasonal lull we'd expect this time of year," said Remax CEO Adam Contos in a press release.
There was a 5.4% decrease in the home sales inventory, making 118 months of drops. But it was the smallest year-over-year decrease since August 2014. And it was the fourth consecutive month to record a single-digit percent decline, rather than the double-digit monthly drops consistently that occurred earlier this year and over the previous three years, Remax said.
"It varies by market, but we're hearing that buyers are being more selective and sellers are becoming more pragmatic," said 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."
The supply of inventory rose to 3 months, compared with 2.9 months in July. But this is down from 3.1 months in August 2017. A market balanced between buyers and sellers has a 6-month supply.
The time from a property being listed through a contract being signed increased to 43 days on average, up 2 days from July but down 4 days from August 2017.
"The economy is strong and potential buyers are out there; they just need more listings, at the right price points, to consider," said Contos. "We believe that balance will return, which will be good for everyone in the long run. It's just a matter of when."