A fifth straight month of shrinking inventory year-over-year triggered several November records in the 11-year history of the RE/MAX National Housing Report: fewest Days on Market at 49, fewest Months Supply of Inventory at 3.3, and the highest Median Sales Price at $257,000. But what does that mean for the Phoenix housing market and Phoenix home buyers and sellers?
Phoenix residents are experiencing a rise in home sales prices. Here is a quick snapshot of local housing data:
• Median Sales Price: $283,500, up 8.2% year over year
• Closed Transactions: 6,919, up 7.7% year over year
• Month’s Supply Of Inventory: 1.9, down 40.6% year over year
• Days On the Market: 38, down 15.6% year over year
In the 54 metro areas covered by the report, November home sales overall averaged 1.0% below November 2018 following significant year-over-year increases in September and October. Thus far, four months of 2019 posted year-over-year sales increases and seven, including November, have seen declines. Three of the monthly declines, however, were less than 2% below 2018 sales levels.
As inventory dropped 13.3% from November 2018, it took an average of 49 days to sell a home last month, compared to 51 days a year ago. The 3.3 months of inventory represented a sharp drop from 4.4 months a year ago.
“We continue to see favorable economic conditions and solid demand, but buyers coming into the market are being met with a progressively constrained supply of homes for sale,” said RE/MAX CEO Adam Contos. “This has helped accelerate the pace of sales and push up prices, two factors that favor sellers. As we approach 2020, it seems likely that inventory will be the market’s main throttle next year – if more homes come on the market, sales should benefit; if that doesn’t happen, sales may be challenged. Buyers are out there and ready to go; we just need more listings to meet the demand.”
The November Median Sales Price of $257,000 marked a 7.9% year-over-year increase. It was the third-highest year-over-year increase thus far in 2019. While prices declined month-to-month from June through September, price appreciation began to accelerate in October and the November Median Sales Price topped October by 0.7%. November prices have topped October’s for nine consecutive years, dating back to 2011.
Of the 54 metro areas surveyed in November 2019, the overall average number of home sales is down 14.0% compared to October 2019, and down 1.0% compared to November 2018. Leading the year-over-year sales percentage increase were Los Angeles, CA at +22.5%, Anchorage, AK at +14.5%, and Wichita, KS at +10.5%.
Median Sales Price – Median of 54 metro median prices
In November 2019, the median of all 54 metro Median Sales Prices was $257,000, up 0.7% from October 2019, and up 7.9% from November 2018. Only one metro area, Anchorage, AK at -2.2% saw a year-over-year decrease in Median Sales Price. Five metro areas increased year-over-year by double-digit percentages, with the largest increases seen in Trenton, NJ at +15.9%, Birmingham, AL at +15.3%, and Boise, ID at +13.7%.
Days on Market – Average of 54 metro areas
The average Days on Market for homes sold in November 2019 was 49, equal to the average in October 2019, and down two days from the average in November 2018. The metro areas with the lowest Days on Market were Omaha, NE at 23, Nashville, TN at 29, and Cincinnati, OH at 32. The highest Days on Market averages were in Des Moines, IA at 100, Augusta, ME at 85, and Miami, FL at 81. Days on Market is the number of days between when a home is first listed in an MLS and a sales contract is signed.
Months Supply of Inventory – Average of 54 metro areas
The number of homes for sale in November 2019 was down 10.9% from October 2019 and down 13.3% from November 2018. Based on the rate of home sales in November 2019, the Months Supply of Inventory held steady at 3.3 compared to October 2019, and decreased compared to 4.4 in November 2018. A six months supply indicates a market balanced equally between buyers and sellers. In November 2019, of the 54 metro areas surveyed, two metro areas, Miami, FL at 7.9 and Indianapolis, IN at 6.3, reported a months supply at or over six, which is typically considered a buyer’s market. The markets with the lowest Months Supply of Inventory were San Francisco, CA at 1.4, and a three-way tie between Seattle, WA, Manchester, NH, and Denver, CO at 1.7.