Number of homes for sale up 3% in the US, first rise for almost four years
The number of homes for sale in the United States has increased year on year for the first time for almost four years, the latest real estate market report shows.
There were 3% more homes for sale across the country than there were a year ago, ending almost four years of declining inventory, according to the report from property firm Zillow.
Last October, inventory fell by 10.2% year on year before the residential market saw a marginal pick up of 0.1% in September and now a more robust rise in October 2018.
High cost markets that had been among the nation’s hottest saw some of the biggest gains in inventory. San Jose, California, saw the biggest annual increase in inventory, adding about 1,500 homes to the market to increase inventory by 93.1% year on year. San Diego, San Francisco and Seattle also saw big gains in the number of homes for sale.
‘In yet another sign that the housing market is cooling, we’re finally starting to see inventory return after several years of annual declines,’ said Zillow senior economist Aaron Terrazas.
‘The combination of tight supply and strong demand have pushed up home values in recent years, but markets always ebb and flow and there is no doubt that the tides that have buoyed sellers are shifting,’ he explained.
‘But buyers are not out of the woods yet. While there are more homes for sale, rising mortgage rates are quickly eating into what they can afford to pay. First time buyers have benefited from flat or falling rents over the past year, making it somewhat easier to save for a down payment. But the decline in rents could be short lived if higher buying costs push some people back toward the rental market,’ he added.
Price growth was steady in October at 7.7%, taking the median home value to $221,500. San Jose and Las Vegas saw the strongest home value appreciation. These two markets have led the nation’s largest markets in annual home value growth for the past year.
About half of the 35 largest metro areas saw slower home value growth in October 2018 than they did in October 2017. The biggest slowdown was in Seattle, which fell from 12.6% annual growth to 7.1%. Home value growth increased the most in Indianapolis, from 5.5% in 2017 to 11.9% in 2018.
Rents declined on an annual basis by 0.1% to a national median rent of $1,442. Rents fell year over year in 18 of the 35 largest markets, led by Portland, Oregon, where rents fell by 3%.