Supply ticked up slightly, and home prices grew at the fastest rate in three years in the first week of month
The number of homes listed for sale in the U.S. improved slightly in the first week of October, a sign that high prices might be luring sellers into the market, according to a new report on Thursday.
The slight increase in total listings comes as the average asking price remained “stubbornly high” in the week ending Oct. 3, close to the peak of $350,000 recorded during the summer, according to the report from realtor.com. Home prices were 12.9% higher than a year ago, marking the highest annual growth the listing website has recorded since 2017.
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The fact that price growth is accelerating even after the school year has started shows just how much the coronavirus pandemic has disrupted the market, which usually sees a lull in the fall and winter months.
“While buyers would normally begin to hunker down this time of year, we expect to see an unusually high number remain in the market this fall,” said Danielle Hale, realtor.com’s chief economist. “This gives sellers a rare opportunity to get top dollar for their home outside of the prime selling season, which may be motivating some to stay in the market.”
Sellers were the first to flee the housing market when Covid-19 first gripped the country in the spring, and they have been much more reluctant than buyers to come back. But there was some improvement last week.
The number of homes on the market in the week ending Oct. 3 was down 38% over the same week last year—slightly better than the prior week, when there were 39% fewer homes on the market than a year ago, according to realtor.com. The number of new listings to come to the market last week was 7% below last year’s total.
The severe imbalance between supply and demand has kept the pace of sales brisk as buyers seize opportunities quickly. The average home sold in 53 days in the week ending Oct. 3, nearly two weeks faster than this time last year.
Springfield, Massachusetts, has seen a 27% surge in listing prices since last year, the highest annual growth of any metro in realtor.com’s latest report.
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Metro areas across Pennsylvania also have seen some of the most frenzied price growth in the nation, with listing prices surging more than 25% over last year in Pittsburgh. Prices are up more than 20% in the Allentown-Bethlehem-Easton corridor and in Scranton, Pennsylvania, as well as in the Memphis, Tennessee, metro area.
“Looking forward, a key question is whether this frenzied demand will continue into the spring or if we’ll see more balance between buyers and sellers,” Ms. Hale said.
Mansion Global is owned by Dow Jones. Both Dow Jones and realtor.com are owned by News Corp.
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