From real estate trends to prices and inventories, the market is constantly in flux. The real estate industry is also highly localized, with varying conditions in every state, city, and neighborhood.
Whether you’re house hunting or selling, it’s crucial to know the current state of the market, especially during its busiest months. Below is a mid-year update of the housing market, presenting data from the National Association of Realtors (NAR).
After four consecutive months of decline, existing-home sales increased in June. The main reason for this is that more people are listing their houses for sale. It is a strong seller’s market in general across the U.S now that we’re well into the summer months.
Three out of four major U.S. regions recorded small month-over-month gains, while the fourth remained flat. However, all four areas marked double-digit year-over-year gains.
Based on NAR’s data, total existing-home sales rose 1.4% on a seasonally adjusted annual rate from May to June. No region showed a sales decline.
From 4.77 million in June 2020 to 5.86 million in June 2021, sales grew year-over-year, up 22.9%. These completed transactions include single-family homes, townhomes, condominiums, and co-ops.
Here are the existing-home sales in four regions:
- Northeast: Sales rose 2.8% in June, registering an annual rate of 740,000. It is a 45.1% increase compared to last year.
- Midwest: In June, sales increased 3.1% to an annual rate of 1,330,000. It is an 18.8% rise from a year ago.
- South: Sales from May were unchanged, registering an annual rate of 2,590,000 in June. It is up 19.4% from the same time last year.
- West: Sales increased 1.7%, recording an annual rate of 1,200,000 in June 2021. It is a 23.7% jump from June 2020.
This year, home prices and equity positions have continued to go up throughout the country. The median home price for all housing types in June 2021 was $363,300, up 23.4% from June last year ($294,400). This marks 112 consecutive months of year-over-year gains.
According to Lawrence Yun, NAR’s chief economist, home prices are not in danger of a decline due to tight inventory conditions. However, prices are expected to appreciate at a slower pace by the end of the year.
In addition, the prices for a home would increase roughly in line with income growth. This is likely to happen in 2022 as new constructions and more listings become available.
Below are the median home prices in four regions:
- Northeast: $412,800, a 23.6% climb from June last year
- Midwest: $278,700, up 18.5% from June last year
- South: $311,600, a 21.4% increase from June last year
- West: $507,000, up 17.6% from June last year
Housing Inventory Levels
The housing supply has been dangerously low in recent years, and the COVID-19 pandemic only made it worse. In 2020, the number of for-sale listings plummeted, at one point reaching the lowest level ever recorded.
At the end of June, the inventory of unsold homes amounted to 1.25 million units, which is up 3.3% from May and down 18.8% from last year’s inventory (1.54 million).
Unsold inventory sits at a 2.6-month supply at the current pace of home sales. It is up from 2.5 months last May but down from a 3.9-month supply in June 2020.
Days on Market
Due to low inventory levels, houses are selling extremely quickly compared to this time last year. In June 2021, 89% of homes sold were on the market for less than a month.
Housing properties usually remained on the market for 17 days in June, which is the same from May and down from 24 days in June last year.
While inventory is still down, home sales and prices continue to increase throughout the country. This indicates that the housing market is generally doing well in the summer months.
Although we are likely to experience a market dip, most experts believe that we are certainly not headed for a crash.