Demand for real estate remains strong in the traditionally slowest time of the year even as the market hits brand new low levels of supply, according to new data on inventory and demand on realtor.com®. Homes for sale in January are moving four percent more quickly than last year even as prices remain at record highs.
The median age of properties on realtor.com in January is expected to reach 96 days, which is four days faster than last year. Despite the typical seasonal slowdown—the median age is eight days slower than last month—inventory is picking up speed for the time of the year.
Another indication of demand remaining strong is that the median list price has remained level at $250,000, and 10 percent higher than one year ago. Typically the median list price reaches its lowest point in January. The estimated median price for January would be a record for January.
This persistent demand is resulting in record low levels of for-sale housing inventory. The January trend continues the sharp double-digit decline observed over the last two months, further intensifying the supply shortage. Total inventory is now at a brand new low and remains substantially lower than one year ago. While nearly 360,000 new listings will enter the market in January, it will still fall short of meeting buyers’ needs.
Jonathan Smoke, chief economist of realtor.com, said:
“We saw evidence of a stronger than normal off-season starting last September and October due to pent-up demand and surging interest from first-time buyers. Since the election demand seems to have intensified potentially as a reaction to mortgage rates rapidly moving higher. The threat of rates approaching multi-year highs in the months ahead is creating a sense of urgency. The downside to this strong off-season is that we have started 2017 with a new low volume of available homes for sale and a new high for prices.”
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