Homes Are Selling Faster...and Prices Are Rising

Despite the challenges to the market presented by the coronavirus pandemic, things are looking up. According to Zillow’s Weekly Market Report for the week ending August 8, newly pending sales are up nearly 17 percent year-over-year, and price growth is accelerating.

Although more new listings were added to the market last week than the week prior, buyers are still confronting an inventory shortage as the number of available homes on the market isn’t enough to keep up with the pace of sales. Total inventory has fallen further below where it was last year, while strong buyer demand persists in both urban and suburban areas of the country during the coronavirus pandemic.

The positive indicators for home sales include:

Newly pending sales rose 1.3 percent from the previous week, and are now up 16.9 percent year-over-year.
Homes sold last week typically went under contract after 13 days, which is 11 days faster than during the same period last year and a new record low in Zillow data that dates back to the start of 2019.
Fast-moving large markets, such as Cincinnati, Columbus, Kansas City and Raleigh, saw sellers typically accept an offer after their homes were on the market only four days.

The challenges for inventory can be seen in the following stats:

There were 4.3 percent more new for-sale listings added to the market than the week prior.
Still, new listings are 13.2 percent lower than a year ago. And total inventory slipped further, now down 27.6 percent year-over-year.

Price increases are reflected in the following indicators:

The median list price in the U.S. last week was $344,660, up 7.3 percent year-over-year. In early May, list prices were up 1.1 percent annually.
In the week ending June 27, the median sale price in the U.S. was $269,700, 1.8 percent higher than the same period a year earlier. Year-over-year sale price growth slowed throughout May but is climbing again, up from 0.7 percent from two weeks earlier.

Finally, despite news of an urban migration as people opt for suburbs over cities due to coronavirus, Zillow reports that urban and suburban housing markets across the U.S. have shown similar strength in key housing indicators since the beginning of the coronavirus pandemic, save for Manhattan and San Francisco.