Another month of mild winter weather has helped boost both the number of homes sold, as well as the number of new listings entering the market. For the under $250,000 price ranges, the homes sales have risen faster than the new listings, causing a drop in listing inventories. For the over $250,000 markets, new listings are coming in faster than sales, pushing up inventories.
In all price ranges the Months Supply of Inventory (MSI) has fallen over the past 90 days compared to last year, which confirms that the overall direction of the market is still positive. As we move out of the winter months, the MSI normally declines as sales pick up speed. The pace of the decline is faster this year as a result of the increasing pace of sales. As we said in prior months, we won’t really be able to judge the strength of our local metro market until April or May, once we see if the milder weather created more buyers or simply moved the same number of buyers to act earlier in the year.
Under $250,000 Price Range
There are 20% fewer homes to choose from in the under $150,000 market and 10% fewer between the price range of $150,000 and $250,000, so buyers will feel even more frustration going into this spring than last. Pending sales (new contracts written) in the under $250,000 price range are up, while the low inventories have pushed the average price per square foot up 7% for the under $150,000 homes and up 4% for the $150-$250,000 segment. New listings entering the market are up, giving some hope of relief to buyers as the spring market unfolds.
$250,000 – 500,000 Price Range
For sale inventories are up 4% over last year, giving buyers a few more choices going into the spring. Sales were also up quite a bit as well, 24% compared to last year. This increase in sales can be attributed to the milder weather. New listings entering the market are up about 15%, confirming that sellers are reacting to the growth in their equity and coming back into the market to sell and buy. The average value per square foot is up over last year, rising about 2%, a modest increase, influenced by a larger supply of homes for sale.
Over $500,000 Range
Inventories continue to rise in the upper price ranges but so have pending sales, making a nice 25% jump in the past 60 days. New listings entering the market also hit a 25% increase. The average price per square foot increase of 7% over last year was the most we have seen in quite some time. We still think the trend for the upper-end markets is slowing, but because of a combination of good weather and a thin market, it does not take a big increase (or decrease) in activity to cause the higher priced markets to fluctuate on a month to month basis.
Overall, we are entering the spring market with continued strong buyer interest, particularly in the under $250,000 price ranges, and we are beginning to see For Sale inventories build up a bit, giving buyers a few more choices than last year for the over $250,000 markets.