Demand for housing kicked up in October 2017. Even in the several markets hit by Hurricanes Irma and Harvey, buyers were seemingly undaunted.
The share of housing inventory sold was higher than pre-recession numbers for the very first time despite there being fewer (-4.1%) existing home sales. Existing home sales rose by 2.0% from September 2017 to the seasonally adjusted rate of 5.85M units nation-wide. Sales had its strongest pace since June 2017 at 5.51M.
Be cautious, however, about all this good news…sales are still
-0.9% below sales of 10/16 and existing home sales remain well below pre-recession levels by -8.1%, according to the National Association of REALTORS (NAR).
Lawrence Yun, chief economist with NAR, said, “Job growth in most of the country continues to carry on at a robust level and is starting to slowly push up wages, which is in turn giving households added assurance that now is a good time to buy a home. But, sales are still below last year’s levels due to limited choices from low inventory and elevated price growth.”
With sellers being reluctant to list their homes, Yun continued on to say that the dearth of homes for sale has led to fewer closings on an annual basis for the second straight month.
The median price for an existing home was $247,000. This represents a +5.5% increase from October 2016 when the median price for an existing home was $234,000. October 2017 was the 68th straight month of year over year gains in median prices.
The market’s nemesis, historically low housing inventory, decreased -3.2% to 1.8M existing homes nationally. Now, the decrease is -10.4% lower than what it was a year ago (2.01M). This decrease of inventory has continued for 29 consecutive months year over year.
Unsold inventory represents a 3.9-month supply, down from 4.4 months one year ago. Days on the market (DOM) as of October 2017 was 34 days…unchanged from September 2017 and down from 41 DOM last year. A startling 47% homes sold in October 2017 were on the market for less than one month.
First time homebuyers represented 32% of sales in October 2017. Annually, first time buyers represent 34% of sales in 2017.
NAR’s Yun said, “Listings, especially those in affordable price ranges, continue to go under contract…a week faster than a year ago and even faster in many areas where healthy job markets are driving sustained demand for buying.” Yun added, “…prospective buyers will likely continue to see competitive conditions through the winter.”
Cash sales represented 20% of all sales in October 2017; single family home sales increased +2.1% from September 2017 and condominium/co-op sales increased +1.7%. The median price of $248,300 for a single- family home in October 2017 increased +5.4% from October 2016. The median existing condo price in October 2017 was $236,000, an increase of +6.9% from October 2016.