- Inventory declined 1.8 percent year-over-year in August
- Median listing price increased 4.9 percent yearly, but declined 1.8 percent monthly
- Median days on market was 66 days, three days longer than last year
Realtor.com®’s August data shows that economic anxieties could be causing an earlier seasonal slowdown, despite an expected boost in demand due to lower interest rates, which have increased buyer purchasing power. Inventory growth in the U.S. has once again turned negative, however, the time a typical property spends on the market is now three days more than last year. In addition, the nation’s median listing price continues to increase but at a slowing rate, and is past its seasonal peak for the year, as we projected in our June Monthly Housing Trends report.
The nationwide median home list price was $309,000, 4.9 percent higher than a year ago. However, price growth is slower than last August, when the median list price grew by 7.3 percent. Additionally, the median listing price in August fell by 1.8 percent compared to July. Typically, prices increase through the summer season until September. Although drops in listing price from July to August have occurred before, this is the largest drop from July to August since our records began in 2012, and points to an earlier-than-typical deceleration of prices in the fall off-season. This is a trend we also highlighted last month.
The median age of properties on realtor.com in August reached 62 days. The typical property spent three more days on the market compared to last August and four more than last month, in keeping with the seasonal trend of buying activity slowing in late summer and fall.
Earlier this season, we predicted that listing growth would again turn negative this fall, however, August has already seen an inventory decline of 1.8 percent over the year, meeting the trend earlier than expected. However, the economic climate has shifted and the trend of declining inventory we forecasted earlier this summer may not continue to materialize into the fall.
The state of the housing market heading into the end of the year will be the result of a battle between two opposing forces: increased affordability and economic anxiety. Lower interest rates have resulted in an increase in affordability, saving home shoppers approximately 5.0 percent on monthly mortgage payment costs compared to August of last year. However, concerns over a prolonged trade war, cutbacks in corporate spending, and contagion from a European recession may push some homebuyers to postpone their plans.
A Realtor.com® August Home Shopper Survey revealed that 11 percent of buyers expect a recession by the end of this year, and 33 percent expect one next year. If a recession does hit next year, 56 percent of home shoppers stated that they would pause their home search.
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