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Inventory is ticking up, demand still remains incredibly strong. That’s what we’ll look at in this week’s Altos Research market report. Every week Altos tracks every home for sale in the country, all the prices and supply and demand metrics and we make this data available to you before the traditional media channels get wise. It’s Monday June 14, 2021 and here’s the data:
The median price of single family homes in the US stayed flat this week at $399,000. The market is past peak pricing of the year, prices will stay under $400,000 ticking down a bit for the rest of the summer. This is normal seasonal behavior. The leading indicator price of the newly listed cohort bounced up this week to $369,000 staying in the band of this summer’s plateau. This tells us that the market price won’t surge from here but neither is it going to pull back notably. If you’re paying close attention you’ll hear some signs of demand and supply trying to rebalance, but remember that demand has been so intense, and it is still plenty sufficient to keep a floor on prices. We can clearly see the rest of the summer is strong, but not getting wackier from here.
Inventory climbed another 3.8% this week to 342,000 single family homes unsold active on market. That’s now up 11% from the bottom April 30th, but still 51% fewer than last year at this time, last year inventory was falling by a couple percent per week and now it’s climbing. Every bit of extra inventory helps this market. Keep it coming baby. As 2021 follows much more normal seasonal patterns, expect that inventory will peak in mid-August at maybe 380,000 single family homes. If you tuned into our webinar last week, you’ll recall that we’re calling this inventory level a “new normal” for the real estate market in that it would take several years of significantly higher interest rates and vastly improved new construction to get us anywhere near the old normal of 1 million or so homes on the market. The recording of the webinar is on the Altos Research YouTube channel in case you missed it last week.
Tracking demand through our Immediate Sales metric: Demand stays hot of course. As total inventory inches higher, the number of listings that go immediately into contract stayed the same this week at 24,000. These are listings that take offers and go into contract essentially immediately after listing. With 80,000 new listings coming to market and spending at least a week. Here’s what this says to us: demand backed off the peak of the frenzy in May but is not continuing to decline. If your house comes to market, and it’s priced right, it’s going to move very quickly.
One other way to look at the supply and demand levels in the market is through the Altos Research Market Action Index. We like the MAI because it presents at-a-glance the relationship between supply and demand. Any reading here above 30 means supply is sufficiently tight relative to the quantity demanded that we call that a “seller’s market” and associated with prices rising in the future. Around 30 is balanced, below 30 is a buyers market. You can see that we’ve been in record territory all year. The notable change this week is that the weekly reading has dipped below the 90-day rolling average for the first time all year. This reiterates the signal that the market is not getting bubblier but still very very hot.
OK that’s all the data we have time for today. If you missed last week’s webinar, that video is now available on the YouTube channel. If you’re a real estate professional, you likely have clients and prospects who are afraid to transact in this market. Market data is how you help them make the best decisions. If that’s you, click in the description at the top of this page to book a demo with us. This is what we do, for you. Thank you. More next week.
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