Homes Selling Fast Amid Low Supply

Buyers need to act quickly, as homes are flying off the market faster than at any time since 2010

- On average, homes stay on the market for 78 days before closing -- a week less than a year ago.

- There are 4.7 percent fewer homes for sale than there were a year ago.

- The Zillow Home Value Index (ZHVI) rose 5.4 percent over the last year, to $187,000 in June. Rents rose 2.6 percent to a Zillow Rent Index (ZRI) of $1,409.

News provided by

Zillow

Jul 22, 2016, 08:00 ET

SEATTLE, July 22, 2016 /PRNewswire/ -- Homes are selling an average of a week faster than they did a year ago, meaning home shoppers should be prepared to move quickly in a competitive housing market, according to the June Zillow® Real Estate Market Reportsⁱ.

Tight inventory continues to be a major factor for home shoppers. The supply of homes for sale is nearly 5 percent lower than it was a year ago, and 38 percent lower than its peak level in 2011. With fewer available options, home shoppers are moving quickly to buy homes, with the average U.S. home closing after 78 days on the market.

The 78-day average includes the time it takes to close, which is usually one or two months after the home goes under contract. This means that homes are pending within about a month of being listed.

The length of time homes stay on the market before selling has been steadily decreasing since 2010, when homes took an average of five months to sell. The average time home buyers had in Pittsburgh, Philadelphia and Charlotte, N.C. dropped by at least two weeks, the biggest change among the largest U.S. metros.

The low inventory and quick-moving market combine to create a competitive home shopping market, especially for potential buyers looking for less expensive homes. The most expensive third of the market has experienced the smallest drop in available inventory compared to the rest of the market.

"Homes are selling faster than ever as the home shopping season hits its peak," said Zillow Chief Economist Dr. Svenja Gudell. "If you're looking for a home, be prepared to move quickly. Adding to this difficult buying environment is low inventory – there simply aren't many homes to choose from. And while this looks like a good time to be a seller, potential move-up buyers may hesitate to list their homes and become buyers. Until the supply increases, it will remain a tough market to find a home."

Tips for buyers in a competitive market

Meet with your lender early and get preapproved for a loan – even before you begin seriously shopping for your new home.
Work with an agent who has expertise in the local market. Read reviews on local agents and find someone with a successful record in a tough market.
Request to pre-inspect a home before submitting an offer. You risk losing a few hundred dollars if you end up not wanting the house; but if you do, you'll be able to submit an offer not contingent on home inspections.

The limited supply of homes is driving home values higher. The average U.S. home is worth $187,000, a 5.4 percent increase from June 2015. Home values have been increasing at 5 percent or faster on an annual basis for the past eight months.

Rents are growing at the slowest pace in nearly two years, up 2.6 percent to a Zillow Rent Indexⁱⁱ of $1,409.

Metropolitan Area	Median Days on Market	1-Year Change in Days on Market	1-Year Inventory Change (%)	June Zillow Home Value Indexⁱⁱⁱ
United States	78	-8	-4.7%	$187,000
New York/Northern New Jersey	157	-6	-9.2%	$386,800
Los Angeles-Long Beach-Anaheim, CA	64	0	-7.6%	$572,400
Chicago, IL	97	-6	-13.3%	$198,200
Dallas-Fort Worth, TX	56	6	-20.5%	$189,500
Philadelphia, PA	98	-15	-10.2%	$208,500
Houston, TX	70	1	4.4%	$172,900
Washington, DC	68	-5	-12.1%	$368,700
Miami-Fort Lauderdale, FL	103	5	13.5%	$235,500
Atlanta, GA	76	-6	-6.4%	$166,700
Boston, MA	71	-2	-23.2%	$394,400
San Francisco, CA	43	1	4.4%	$812,300
Detroit, MI	84	-9	-16.5%	$127,300
Riverside, CA	77	-3	-6.5%	$309,400
Phoenix, AZ	70	0	8.9%	$221,400
Seattle, WA	47	-3	-15.0%	$392,000
Minneapolis-St Paul, MN	75	-5	-0.9%	$227,400
San Diego, CA	61	-4	10.3%	$512,900
St. Louis, MO	74	-4	-13.3%	$142,500
Tampa, FL	78	-10	-8.9%	$167,700
Baltimore, MD	99	-7	-11.6%	$251,400
Denver, CO	52	0	4.4%	$338,500
Pittsburgh, PA	97	-15	2.1%	$130,400
Portland, OR	51	-4	-23.7%	$330,800
Charlotte, NC	70	-15	-11.5%	$162,300
Sacramento, CA	55	-4	-13.7%	$341,900
San Antonio, TX	69	-4	20.4%	$152,300
Orlando, FL	81	-7	-12.3%	$186,400
Cincinnati, OH	83	-8	-20.4%	$143,800
Cleveland, OH	93	-1	-20.2%	$128,500
Kansas City, MO	70	-5	-26.1%	$149,100
Las Vegas, NV	73	1	13.8%	$203,800
Columbus, OH	74	-3	-14.4%	$156,000
Indianapolis, IN	85	-11	-22.2%	$130,200
San Jose, CA	43	4	15.2%	$957,900
Austin, TX	57	-1	1.1%	$252,900

Zillow
Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Zillow also sponsors the bi-annual Zillow Housing Confidence Index (ZHCI) which measures consumer confidence in local housing markets, both currently and over time. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ:Z and ZG), and headquartered in Seattle.

Zillow is a registered trademark of Zillow, Inc.

ⁱ The Zillow Real Estate Market Reports are a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Real Estate Research. For more information, visit www.zillow.com/research/. The data in Zillow's Real Estate Market Reports are aggregated from public sources by a number of data providers for 928 metropolitan and micropolitan areas dating back to 1996. Mortgage and home loan data are typically recorded in each county and publicly available through a county recorder's office. All current monthly data at the national, state, metro, city, ZIP code and neighborhood level can be accessed at www.zillow.com/local-info/ and www.zillow.com/research/data.
ⁱⁱ The Zillow Rent Index (ZRI) is the median Rent Zestimate® (estimated monthly rental price) for a given geographic area on a given day, and includes the value of all single-family residences, condominiums, cooperatives and apartments in Zillow's database, regardless of whether they are currently listed for rent. It is expressed in dollars.
ⁱⁱⁱ The Zillow Home Value Index (ZHVI) is the median estimated home value for a given geographic area on a given day and includes the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. It is expressed in dollars, and seasonally adjusted.

SOURCE Zillow