Low home inventory in February drove home prices up to a record high in the 9-year history of the RE/MAX National Housing Report. Here's what you need to know from the March 2017 edition.
1. Inventory has been dropping since 2008
The active inventory of homes for sale across the country dropped 17.9 percent year-over-year in February. It's the 100th consecutive month of year-over-year declines, dating back to October 2008.
"Inventory, not the rise in interest rates, remains the principal constraint on home sales," said Dave Liniger, RE/MAX CEO, Chairman of the Board and Co-Founder. "The resale market is driven dramatically by the availability of new homes. Most U.S. markets have a high demand for new home construction, and although it's good to see housing starts trending upward, we still need more."
2. Home prices continue to rise
Low inventory drove prices up six percent year-over-year to a median sales price of $212,000 for the 53 metro areas surveyed. Only six metro areas saw year-over-year decreases or remained unchanged. Sixteen areas saw double-digit increases, with prices rising the most in Fargo, North Dakota (+19.9%), Burlington, Vermont (+18.4%) and Tampa, Florida (+15.9%).
3. Homes aren't lingering on the market
Houses spent fewer days on the market in February than the same time last year, dropping from an average of 75 days on the market in February 2016 to 68 days during February 2017. Where are things moving most rapidly? San Francisco at 32 days, Omaha, Nebraska at 34 and Denver at 38. Homes are sticking around longest in Augusta, Maine at 147 and Chicago at 109.
4. The market still favors sellers in most areas
Based on the rate of home sales in February, the Months Supply of Inventory dropped slightly to 3.6 months from 3.8 in January. A six-month supply indicates the market is equally balanced between buyers and sellers. In February, 45 of the 53 metro areas surveyed reported a months supply of less than 6.0, typically considered a seller's market. The other eight areas reported a months supply of more than 6.0, usually considered a buyer's market. Inventory continues to be scarcest in the west: Denver, Seattle, and San Francisco each had a months supply close to 1.0.
View the full March housing report below.