Realtor.com recently released its January 2018 housing trend analysis for the top 500 metro areas. Overall, it looks like 2018 is off to a good start in most markets. Affordability for first-time buyers combined with low inventory makes it a seller’s market for entry-level to mid-tier homes, defined by realtor.com as $100,000-$350,000. The jury is out on the direct impact the stock market’s recent volatility will have on housing.
Here are the national numbers comparing January 2018 with January 2017:
- Median Listing Price: $269,500, up 8%.
- Days on Market: 89 days, down 7%.
- Inventory: 1.23 million listings, down 8%.
Javier Vivas, director of economic research at realtor.com, provides some insight: “What’s interesting is we are seeing the start of the buying season begin as soon as January. This year’s buying market isn’t waiting for spring, which is the traditional beginning we’ve seen in past years.”
With inventory selling faster than it did last January, the country is facing a housing shortage, especially for first-time buyers. “We are seeing the lowest level of inventory in at least two decades. It really is a shortage of historical proportions,” Vivas observes.
“It’s a good time to be a seller in the low- to mid-range market,” Vivas adds, pointing to an imbalance of buyers to sellers there. It’s a hard time to be a millennial just starting a family and looking to become a homeowner.
Here’s the picture from around the country, according to realtor.com’s numbers.
In the Seattle-Tacoma-Bellevue area, Days on Market are down 16.7% from last January. Combine this with Active Listings, down 16.2% year over year, and it sounds like a shortage to me. “In the Seattle market, we’ve seen inventory numbers decline for three years in a row with each January since 2016,” explains Matt van Winkle, founder of RE/MAX Northwest (Seattle). “January of 2018 is down again from previous years, but buyer demand remains as high. In popular neighborhoods in the City of Seattle, we see just one-third of a month of inventory and less than 20 days average on market.”
Even Las Vegas, slammed when the housing market fell apart, is on the mend. The metro area of Las Vegas-Henderson-Paradise is up and running. Days on Market are down 20.3% year over year. The Active Listing count is down 28%.
Listen to Tim Kelly Kiernan, director and realtor at RE/MAX Excellence (Las Vegas): “Las Vegas has bounced back since the recession of 2008, when 72% of the homes were ‘upside down’ regarding their equity. 2017 showed a 14% increase in home values year-over-year, but the inventory has dropped dramatically to the lowest in almost a decade. With only 3,772 single-family homes available, there is frustration and disappointment from some potential buyers.”
Moving on to Denver, where a population surge is contributing to market pressures: “Colorado’s central location, desirable lifestyle and favorable climate has helped the state far surpass a typical growth trajectory, with the Denver metro region experiencing a net gain of nearly 600,000 residents between 2010 and 2016. The January 2018 numbers reflect the challenges facing home owners in this emerging metroplex.”
“The concern over rising home prices outpacing incomes is a realistic concern in the Denver Metro area,” explains Kerron Stokes, managing partner, resource group, at RE/MAX Leaders (Denver). Realtor.com’s year-over-year stats on the Denver-Aurora-Lakewood metro area reflect this. Days on Market are down 14.4% while Active Listing Count is down 5.8%.
In the Atlanta-Sandy Springs-Roswell metro area, the Active Listing Count is down 10.9%. Kristen Jones, broker/owner of RE/MAX Around Atlanta, said: “Lack of inventory is still a major issue. We are encountering situations where a buyer plans to look at homes later in the week, and by the time that day arrives, the homes they intended to look at are under contract.”
Wendy Bunch, broker/owner of RE/MAX Pure (Atlanta), confirms inventory pressures depending on area: “The closer you go to the urban areas, the sales are brisk. There is a shortage of inventory, which is driving the prices higher as buyers are willing to pay more to have the ‘winning’ bid. If the property is priced competitively, staged effectively and market ready, the property will likely receive multiple offers within a week to 10 days of putting it on the market.”
Depending if you are a buyer or seller, this is a good news, bad news story.