Despite the monumental shift in financial conditions that has occurred over the past four months, homes continue to sell quickly and registered their 20th week of double-digit yearly gains last week, according to realtor.com®’s latest Housing Trends Report for the week ending April 30.
- The median listing price grew by 14.7% over last year.
This marked the 20th week of double-digit gains for the typical asking price. Even though mortgage rates now widely exceed 5% and homebuyers have less purchasing power as a result of higher mortgage rates, home prices continue to rise. Coping with an increasingly expensive housing market has buyers searching far and wide for affordable real estate markets according to the realtor.com® Q1-2022 Cross Market Demand Report, and has helped push home prices higher in many markets across the country as demand spills into affordable areas.
- New listings—a measure of sellers putting homes up for sale—were up 3% above one year ago.
realtor.com®’s Best Time to List a home for sale was a few weeks ago, which means that we’re into the time of year when we see more home sellers hitting the market. In fact, seasonally, we tend to see the number of new listings peak on an absolute basis in May. This year, some may be hurrying up the usual month-long home sale prep timeline to get their homes listed before higher mortgage rates tamp down buyer demand.
- Active inventory is down just 3% from a year ago.
The number of homes for sale is past this year’s seasonal low, which was also a record low, which means the number of homes for sale is climbing week to week and month to month as it typically does in spring. While the market has not yet caught up to last year’s level, this week marked a sizable step forward. The gap between this year’s homes for sale and last year’s is now just one-tenth the size that it was at the beginning of the year and half the size it was just last week. The catch up is likely to continue, as realtor.com® has noted previously, and they expect active inventory to surpass year ago levels very soon.
- Homes spent 7 days less on the market than this time last year.
With inventory still relatively limited and mortgage rates climbing, homebuyers intent on making a purchase are still incentivized to act sooner rather than later. As a result, homes are still moving quickly, requiring buyers to make quick decisions before they lose out on opportunities. In a market that calls for fast-action, it’s more important than ever to be prepared. Before starting your search, focus on your primary motivations for buying, know what features you really need to have and what you can compromise on, and agree on the monthly payment you are comfortable with. Preparing these answers ahead of time can keep you focused when making quick decisions.
“Yesterday’s Fed statement and post-meeting press conference hammered home the Fed’s commitment to combating inflation, acknowledging that the massive shift will eat into demand, including for housing,” said realtor.com® Chief Economist Danielle Hale. “The combination of more sellers listing homes for sale and fewer home buyers able to contend with higher housing costs will lead to growth in the number of homes on the market in the months ahead. We expect this reality should help tame price growth as more options and fewer competitors enable buyers to be choosier.”
To read the full report, click here.