Despite several indicators of a slowing housing market, prospective home buyers should not get too excited – inventory remains limited and changes are in line with the traditional seasonal slowdown, according to RE/MAX’s August national housing report.
The report analyzes MLS data from 51 U.S. metropolitan areas and includes all residential properties.
In August, home sales dropped 3.5% from July’s total, which is slightly larger than the 2015-2019 July-to-August drop of 2.1%, the report found. Still, August 2021 home sales were still up 0.6% in a year over year comparison. The metros with the greatest increase in year-over-year sales percentage were New York (55.1%), Honolulu (37.3%) and Las Vegas (12.5%).
The median sale prices of homes also decreased to $335,000, dropping 1.2% in August from July. Although this decrease is in line with the 2015 through 2019 average July-to-August drop of 1%, it still marks a 13.2% increase in median home sale price from August 2020. It total, the report also found that 36 of the 51 metro areas had double-digit year-over-year percentage increases for August, with Boise, ID (30.6), Phoenix (24.9%) and Salt Lake City (22.3%) showing the greatest changes.
This is consistent with other reports. HouseCanary recently found that Boise has been the fastest-growing city in America since December 2020, and Provo/Orem, Utah was second. The Case-Shiller Index noted that in June, Phoenix had the highest price growth rate of any large city in America, a title it’s held for 25 consecutive months.
According to RE/MAX, the average number of days a house spent on the market in August was 24, which is up from 23 days in July, according to the report. However, this still reflects an 18-day decrease, on average, in number of days on the market compared to August 2020, illustrating that while the market may be cooling off as we head into fall, it is still stronger than it was a year ago.
Low inventory is another indication of a still-scorching housing market. From July to August 2021 the number of homes for sale decreased 6.2% and it was down 26.7% from August 2020, according to RE/MAX. The July-to-August decrease means that the month’s supply of inventory decreased to 1.3. A six-month supply of inventory generally indicates a housing market balanced equally between buyers and sellers. The markets with the lowest month’s supply of inventory in August were Albuquerque, New Mexico, Raleigh-Durham, North Carolina, Seattle, Denver, and Charlotte, North Carolina all at 0.6.
“The slight seasonal decline in home sales from July to August was countered by this being the second-highest August sales total in the 13-year history of our report. So, although we appear to be past the blistering summer peak, the market is still very active,” said RE/MAX President Nick Bailey in a statement. “In any case, it seems likely that the combination of super-quick sales and a severe lack of inventory will be with us for the foreseeable future.”