For the second month in a row, home prices have risen higher than a year ago. Median prices in March were an impressive 5.8% higher than March 2011 in the 53 metro areas surveyed for the RE/MAX National Housing Report. February marked the first time in 18 months that home prices rose higher than the previous year, and year-to-year price increases haven’t occurred in two consecutive months since August 2010. Home sales in March were 25.4% higher than February and 1.5% higher than March last year. For the last 9 months, sales have reached a level higher than the same month in the previous year. Following these trends, the spring and summer months should experience increased activity. With falling inventory and many markets witnessing multiple offers with bidding competitions, prices are likely to continue to rise in many areas.
“With buyers starting to jump into this market, this year’s selling season is shaping up to be the strongest we’ve seen in years,” said Margaret Kelly, CEO of RE/MAX, LLC. “Although we don’t expect home prices to rise in every market at the same rate, the worst is definitely behind us, and a slow, steady recovery is taking hold.”
Transactions – Year-Over-Year Change
March home sales were 25.4% higher than sales in February and 1.5% higher than March 2011. This represents the 9th straight month that sales have been higher than levels in the previous year. Good weather, low interest rates, attractive pricing, and improving consumer confidence have drawn many buyers into this year’s growing market. Of the 53 metro areas included in the March survey, 33 experienced a year-over-year increase in sales, and 17 of those saw double-digit increases including: Wilmington, DE +41.8%, Omaha, NE +30.6%, Providence, RI +26.6%, Tulsa, OK +26.0%, Chicago, IL +23.7% and Milwaukee, WI +21.4%.
Median Sales Price
For homes sold in March, the Median Sales Price was $184,525. This represents a 7.3% price increase from February, and a 5.8% increase from the March 2011 median price. March marks only the second year-over-year price increase in 19 months and the first consecutive increase since August 2010. In the March RE/MAX National Housing Report of 53 metro areas, 36 experienced price increases from March 2011, with 10 seeing double-digit increases including: Detroit, MI +22.8%, Miami, FL +21.8%, St. Louis, MO +18.5%, Phoenix, AZ +18.2%, Atlanta, GA +13.7% and Orlando, FL +12.7.
Days on Market – Average of 53 Metro Areas
For homes sold in March, the average Days on Market was 101, which was two days less than the average reported in February, and three days less than the 104 average seen in March 2011. Only two times in the last 12 months was there a Days on Market average below 90: July and September 2011 both reported 88. Days on Market is the number of days between first being listed in an MLS and when a sales contract is signed.
Months Supply of Inventory – Average of 54 Metro Areas
The average inventory of homes-for-sale in March for the 53 surveyed metro areas dropped 2.8% from February and also dropped 23.2% from March 2011. Month-to month inventories have now fallen for 21 consecutive months, mostly as a result of lower foreclosure rates. With the size of this active inventory, the resulting Months Supply is 5.3 months, given the current rate of sales. This is a month less than the 6.6 supply seen in February and almost 2 months less than the 7.1 supply in March 2011. Months Supply is the number of months it would take to clear a market’s active inventory at the current rate of sales. A six-month supply is considered a balanced market between buyers and sellers.