Homes selling at record pace, with median prices hitting all-time highs
Median home sale prices hit a record high of over $311,000, up 9% year-over-year.
Homes are flying off the market amid the coronavirus pandemic, according to a new analysis by real estate brokeredge Redfin.
For the four-week period ending August 2, Redfin found that 46% of homes sold within the first two weeks on the market, the highest level since at least 2012. During the same period last year, 32% of homes found a buyer within two weeks.
Redfin analysis of MLS data
Redfin found that homes are selling closer than ever to their list price, with the average sale-to-list price ratio remaining at its record high of 99% compared to 98.5% during the same period last year.
The homes actively listed for sale during the four week period had been on the market for 49 days, the lowest level on record.
"In other words, the typical home for sale was listed around mid-June," Redfin real estate analyst Tim Ellis wrote. "Homes typically take longer to sell after June as the spring homebuying season winds down."
The age of inventory, or time on the market, fell at a record pace, down 18 days compared to the previous increase of 6.5 days between early June and early August last year.
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In addition, median home sale prices hit a record high of over $311,000, up 9% year-over-year. In the last week of the period alone, the median home sale price hit $316,614, up 11% from a year earlier.
“Hands down, interest rates are the major driving factor in home prices right now,” said Orange County Redin agent Brian Morales. “Affordability with interest rates below 3% is key. The combination of ultra low inventory, very high buyer demand, and super duper low interest rates is a very successful formula for sellers, not so great for buyers.”
Redfin analysis of MLS data
Redfin's analysis found that these home price gains demonstrate an "unseasonably strong" demand over the past month, with home prices increasing by 3.5% compared to the decrease of 1.7% for the same period last year.
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According to Redfin, that demand isn't showing any signs of slowing down, with its seasonally adjusted Homebuyer Demand Index up 29% for the period compared to pre-pandemic levels in January and February.
Redfin analysis of MLS data
Pending home sales were up 10% compared to a year earlier, despite a small increase of 0.2% between the four-week periods ending July 5 and August 2. Those sales declined an average of 1.4% for the same period in both 2018 and 2019.
Redfin analysis of MLS data
Despite the boom in demand, supply continues to fall with new listings down 2.7% year-over-year and active inventory of homes for sale down 28% year-over-year, the lowest point since the National Association of Realtors and the government began tracking this data in 1999.