Low Inventory Continues to Wreak Havoc on Market

Key Highlights

• Home sale prices at all-time high
• Days on market for median of 21 days
• Average sale-to-list price ratio at all-time high

Can’t Blame Pandemic for Historically Low Inventory and Skyrocketing Home Prices

There has been an ongoing debate in the housing industry about whether or not fear of COVID infection has been keeping current homeowners from selling their homes.

Daryl Fairweather, chief economist with Redfin, says no.  “With a third of American adults now fully vaccinated and still hardly any homes being listed for sale, we’re close to settling that debate…without more homeowners listing, buyers are scrambling to compete for the limited number of homes on the market, which continues to drive prices up to new heights.”

Redfin’s Latest Indicators on Mid-March to Mid-April Housing Market

Let’s look at a snapshot view of Redfin’s latest market findings covering mid-March – mid-April:

• Home sale prices nationwide reached an average of $344.625.
  • This is an all-time high.
  • This is an increase of +18% y/y.
• Days on marketi n more than 400 metros analyzed by Redfin came in at a median of 21 days.
  • This is 16 fewer days that same period in 2020
  • This 21 median DOM is the shortest time since 2012.
• The average sale-to-list price ratiohit an all-time high of 101.0%.
  • This 101.0% is an increase of +2.3% y/y.
  • This 101.0% means that the average home sold for +1% more than the listing price.
• The average listing price soared to $356,175 during mid-March – mid-April.
  • This $356,175 is an increase of +19% y/y.
• Redfin reported a drop in inventory of -40%y/y during mid-March – mid-April.

If Not Fear of COVID, Why Aren’t Owners Selling?

As far as Fairweather is concerned, Redfin’s chief economist, many prospective sellers are not selling out of fear of not being able to find or afford a new home.

Fairweather said, “If (prospective sellers) move and buy another home they will face a very competitive housing market as buyers, and they don’t need to sell to take advantage of record low mortgage rates – they can just refinance their current home.”

Thanks to Redfin and HousingWire.

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