School’s out for the summer, and as vaccination rates rise and America enters a new normal, the U.S. housing market continues along at a frenzied pace, with low interest rates and limited inventory fueling record high sales prices. May saw the median existing-home sales price exceed $350,000, a 24% increase and the largest year-over-year increase since 1999, according to the National Association of REALTORS®. Eager buyers are making multiple offers, some for well over asking price, while others are making offers on homes sight unseen.
New Listings were down 31.2 percent for single family homes and 41.3 percent for Condo/TIC/Coop properties. Pending Sales increased 17.2 percent for single family homes and 57.7 percent for Condo/TIC/Coop properties.
The Median Sales Price was up 12.1 percent to $1,940,000 for single family homes and 2.0 percent to $1,250,000 for Condo/TIC/Coop properties. Months Supply of Inventory decreased 59.1 percent for single family units and 57.7 percent for Condo/TIC/Coop units.
The increase in sales prices comes with a slight decline in existing home sales nationwide, as homebuyers struggle with declining affordability amid a lack of inventory, forcing some buyers to simply wait it out in hopes of more inventory and less competition. Meanwhile, home builders are trying to meet the increased market demand, with housing starts up 3.6% in May from April, according to the Commerce Department. As we ease into new routines and look forward to a post-pandemic future, one thing remains certain: America desperately needs more homes.