How Low Inventory is Playing Out Across the Country
Low, low inventory – it’s definitely not a new story. In September, when I wrote about the shrinking inventory of homes for sale, we were still waiting to see if buyer demand would persist, pushing up prices or if frustrated buyers would throw in the towel, halting price gains for the time being.
Nationally, inventory dropped 2.2% in September as compared with August, and a whopping 17.8% from September 2011! A drop in inventory isn’t totally untypical for fall as summer is real estate’s boom time, but the year over year decrease is quite notable.
Let’s take a look at how the continuing inventory shortage is playing out in a few metros this fall.
Of all the metro tracked in Relator.com’s report, Sacramento had the greatest decrease in month-to-month inventory change. In this case, traditional economics hold. Supply is way down, and as a result, prices are up by 6.6% month-to-month.
Phoenix and Atlanta
In both Phoenix and Atlanta, inventory has been hurdling downwards, and in Atlanta’s case, not really letting off. Prices in the metros are also continuing to rise at 2.7% and 2.3%, respectively. One of the chief differences between them is that listings are selling much faster in Phoenix with a median age of listing of 47 days.
Considering that the city by the bay is already a very expensive market with a median list price of $750K, monthly price gains of 3.5% are pretty remarkable. San Francisco is a notoriously competitive market, and as it’s seeing extremely low days on market (median listing age of 44 days), it looks like some more sellers are jumping into the housing game. In September, there were 2.3% more homes for sale than the in August – just one of three markets tracked that saw an increase!
As falls really rolls in, there will likely be less competition in the market – though possibly less listings, too. If you’re a buyer, be persistent through these colder months. You may find the right house and be able to make an offer with less competition during this time. And if you don’t, spring will probably bring the best season we’ve had in a few years, so do what you can to get prepared now!