Lack of Affordable Homes Continues to Frustrate Buyers Nationwide
Home prices remained at seasonal and historical highs and continued to be in short supply in August, according to new data from realtor.com. Inventory continued to sell at a record clip in August, moving 8 percent more quickly than in August 2016.
This month, the Detroit metro area jumped six places in realtor.com’s hottest market ranking. It is now the fourth hottest market in the country, up from No. 10 last month. Homes in Detroit are selling in just 39 days.
“Detroit jumped into realtor.com’s top five hottest housing markets last month, said Danielle Hale, chief economist for realtor.com. “While prices are increasing in Detroit, homes are still priced about 20 percent below the national average, which has made the market a hotbed for buyers. On top of that, the market’s median income is nearly identical to the national average, which gives those looking for a home a lot of buying power in this metro.”
Nationally, the median age of listings on realtor.com in August is 66 days, which is two days more than last month, but six days faster than in August 2016. The median nationwide home list price, $275,000, has remained unchanged since May and is 10 percent higher than it was last August.
While total inventory hit a seasonal peak and saw a slight increase over July, it remains significantly lower than last August. By the end of the month, realtor.com data indicates that another 500,000 new listings will have hit the market in August, representing the biggest year-over-year increase in new inventory since March 2016. However, many of those homes are being listed at relatively high price points, failing to provide relief to the lower end of the market where there is the most demand.
Hale added, “As we enter the last days of summer, many frustrated house hunters know this tale of steep prices, limited options and intense competition all too well. For first-time buyers, those conditions aren’t likely to improve much during the fall, unfortunately, though there could be the start of some relief in the mid- to upper-tier.”
- Median age of inventory is estimated to end at 66 days, down 8 percent from last year and up 3 percent from last month.
- Median listing price for August should remain at $275,000, unchanged since May but a 10 percent increase year-over-year.
- Listing inventory in August should show a decrease of 9 percent year-over-year. Additionally, August inventory should show less than a 1 percent increase over July.
- Realtor.com’s Hottest Markets receive 1.5 to 2.9 times the number of views per listing compared to the national average. In terms of supply, these markets are seeing inventory move 21-37 days more quickly than the rest of the U.S. The median age is 4 days faster for the hottest markets on average from last August.
REALTOR.COM® HOTNESS INDEX
|20 Hottest Markets||August Rank||August Median Age of Inventory||July Rank||July Median Age of Inventory|
|Vallejo-Fairfield, Calif.||1||31 days||1||31 days|
|San Jose-Sunnyvale-Santa Clara, Calif.||2||29 days||4||30 days|
|San Francisco-Oakland-Hayward, Calif.||3||32 days||3||32 days|
|Detroit-Warren-Dearborn, Mich.||4||39 days||10||38 days|
|Stockton-Lodi, Calif.||5||34 days||6||35 days|
|Kennewick-Richland, Wash.||6||34 days||2||31 days|
|Fort Wayne, Ind.||7||40 days||8||38 days|
|Columbus, Ohio||8||41 days||7||38 days|
|San Diego-Carlsbad, Calif.||9||38 days||5||36 days|
|Sacramento–Roseville–Arden-Arcade, Calif.||10||39 days||9||37 days|
|Dallas-Fort Worth-Arlington, Texas||11||43 days||11||39 days|
|Modesto, Calif.||12||39 days||16||39 days|
|Waco, Texas||13||45 days||15||44 days|
|Santa Rosa, Calif.||14||44 days||20||44 days|
|Fresno, Calif.||15||44 days||14||42 days|
|Grand Rapids-Wyoming, Mich.||16||38 days||26||39 days|
|Colorado Springs, Colo.||17||41 days||12||35 days|
|Denver-Aurora-Lakewood, Colo.||18||36 days||17||32 days|
|Oxnard-Thousand Oaks-Ventura, Calif.||19||44 days||25||41 days|
|Nashville-Davidson–Murfreesboro–Franklin, Tenn.||20||38 days||24||38 days|
**Realtor.com reviewed listing views by market as an indicator of demand and median days on market as an indicator of supply. This analysis led to the identification of the 20 hottest medium-sized to large markets in the country.
Key Takeaways from realtor.com’s® August Hotness Index:
- California dominated the list with 10 markets, but seven other states were represented (Washington, Ohio, Michigan, Colorado, Texas, Indiana, and Tennessee).
- Detroit-Warren-Dearborn, MI entered the top five for the first time since October 2013.
- The new entrants to the top 20 in August were Grand Rapids-Wyoming, MI; Oxnard-Thousand Oaks-Ventura, CA; and Nashville-Davidson–Murfreesboro–Franklin, TN; up 10, 6 and 4 spots, respectively, since July.