My lead graphic in my newsletter highlights the summer-time trend of a significant increase in the number of homes coming to market, along with a big decline in pending transactions and sales.
In fact, the number of new listings in June this year is higher than any month in the last 10 years. New listings in July were consistent with the past couple of years. At the same time, the number of transactions, which through May had been following the typical trend, suddenly dropped significantly and June was off more than -20%, and July was down roughly -40%.
That is easier to see in the following graphics:
In the price points under 750K, transactions are down -47%:
And in the higher price points over 750K, the trend is the same but not as extreme, down ~-30%:
Increasing inventory and fewer buyers in the market are leading to price pressures, reflected in the ratio of sold price to list price, which was well over 100% in the spring, but has trended back toward 100% (or below) for all price ranges.
It is difficult to know if price premiums have declined due to more inventory in the market or if sellers have been increasing asking prices to reflect market appreciation. I have seen the median sales price in the $1M-1.5M price range steadily decline since April, now down ~-4% after a YTD peak of $1.24M.
Lastly, just to help illustrate the new listing activity, here is a graph that shows new listings each month vs. active listings each month. New listings are listings that are added to the MLS, reflecting new inventory. Active listings simply measures the number of homes that are active in MLS on the last day of a particular month.
You can see that once we got into the pandemic years, the number of active listings declined significantly. In 2021, even as the number of new listings increased almost every month from early spring through late summer, the number of active listings lagged, reflecting how quickly new inventory was snapped up by eager buyers.
In 2022, new listings have steadily increased right up to June and then dropped off some in July, but active listings have continued to rise as fewer buyers pursue them, homes sit, and inventory grows.
If you want to make sense of what’s going on in the market or would like a better understanding of what your own home is worth, please contact me and I’d be happy to help you.