The national median home price rose 8.2% year over year to $323,800 in July, the third time in four months that prices have a hit a new all-time high, according to tech-powered brokerage Redfin. Low mortgage rates continued to drive a spike in early homebuyer demand that has not been met with a matching surge in homes for sale.
“Home sales made a whopping recovery in July,” said Redfin Chief Economist Daryl Fairweather. “It may seem like the Twilight Zone for the housing market to be performing better than ever while the economy is in the tank, but it goes to show that we are in truly unprecedented times. The housing market was incredibly robust going into the pandemic with household debt at its lowest level in 40 years. The less debt someone has, the less likely they are to be worried about affording a mortgage, which is as inexpensive as it’s ever been due to record-low interest rates, making a home purchase very appealing to people who are lucky enough to be securely employed.”
Active listings — the count of all homes that were for sale at any time during the month — fell 21.8% year over year to their lowest level on record in July, the 11th straight month of declines. The supply shortage is worsening because home sales are increasing at a faster rate than the number of homes being listed. At the same time, a growing share of homes is selling quickly, leaving few for sale from one month to the next.
Median prices increased in all but one of the 85 largest metro areas Redfin tracks. The only area where prices fell was Honolulu, Hawaii, with a decline of 4%. Meanwhile, Birmingham, Alabama (+16.8%), Bridgeport, Connecticut (+16.5%) and Fort Lauderdale, Florida (+14.3%), saw the largest year-over-year increases.
Home sales increased in July from a year earlier in 67 of the 85 largest metro areas — nearly three times as many as in June. The largest gains in sales were in Bridgeport, Connecticut (+34.9%), Baton Rouge, Louisiana (+33.8%) and Lake County, Illinois (+26.4%). There are still a handful of markets where sales are falling though, with New York dominating the list of the biggest declines, led by Nassau County, (-38.9%), Buffalo, (-37.7%) and New York City (-35.2%).
The typical home that sold in July went under contract in 35 days—one day less than a year earlier. The share of homes that found a buyer within two weeks of listing hit a record in July at 48.5%—up from just 35.7% in July 2019 and the highest level since we began measuring it in 2012.
