{"id":50734,"date":"2016-06-16T04:01:31","date_gmt":"2016-06-16T11:01:31","guid":{"rendered":"https:\/\/redfindevelop.wpengine.com\/blog\/?p=50734"},"modified":"2020-10-06T12:59:49","modified_gmt":"2020-10-06T19:59:49","slug":"the-housing-market-accelerated-to-its-fastest-pace-on-record-in-may","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/news\/the-housing-market-accelerated-to-its-fastest-pace-on-record-in-may\/","title":{"rendered":"The Housing Market Accelerated to its Fastest Pace on Record in May"},"content":{"rendered":"
\"National<\/figure>\n

While home prices grew a moderate 4.3 percent year over year last month, sales surged 7 percent and inventory fell by nearly as much. These forces, combined with new technologies allowing buyers to see and make informed decisions about homes as soon as they hit the market, caused the pace of sales to accelerate to its fastest level on record. <\/span><\/p>\n

The pickup in sales was widespread, as nearly a third of the markets Redfin tracks reported growth in the double digits. Affordable markets in the Midwest and the South led the surge in sales.<\/span><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n
Market Summary<\/th>\nMay 2016<\/th>\nMonth-Over-Month<\/th>\nYear-Over-Year<\/th>\n<\/tr>\n<\/thead>\n
Median sale price<\/td>\n$269,200<\/td>\n2.3%<\/td>\n4.3%<\/td>\n<\/tr>\n
Homes sold<\/td>\n263,000<\/td>\n11.4%<\/td>\n7.0%<\/td>\n<\/tr>\n
New listings<\/td>\n342,400<\/td>\n-2.8%<\/td>\n-2.2%<\/td>\n<\/tr>\n
All Homes for sale<\/td>\n845,000<\/td>\n2.0%<\/td>\n-6.6%<\/td>\n<\/tr>\n
Median days on market<\/td>\n42<\/td>\n-6<\/td>\n-7<\/td>\n<\/tr>\n
Months of supply<\/td>\n3.2<\/td>\n-0.3<\/td>\n-0.5<\/td>\n<\/tr>\n
Sold above list<\/td>\n23.2%<\/td>\n1.3%<\/td>\n1.8%<\/td>\n<\/tr>\n
Average Sale-to-list<\/td>\n98.5%<\/td>\n3.5%<\/td>\n0.7%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
\"Home<\/figure>\n

In Michigan, Detroit and Grand Rapids saw the number of homes sold surge by more than 50 percent from last year.<\/span><\/p>\n

\u201cGrand Rapids is inventory-starved, so every listing is like a feeding frenzy,\u201d said Redfin agent <\/span>Kent Selders<\/span><\/a>. \u201cAlmost everything is selling immediately, even at higher price points.\u201d \u00a0<\/span><\/p>\n

Tech migration from high-priced cities is a common driver of local demand in Grand Rapids among other affordable markets that saw sizeable increases in home sales this spring. \u00a0<\/span><\/p>\n

\u201cWe\u2019re seeing an influx of buyers from places like San Francisco, Southern California, Seattle and Washington, D.C. Most new residents are lured by tech jobs and opportunities to work remotely,\u201d said Selders. \u201cLocals are watching prices rise, and many realize if they don\u2019t buy soon, they\u2019ll miss out while homes are still affordable. The result is incredible demand and rapid sales. Nothing like this has ever happened in Grand Rapids.\u201d<\/span><\/p>\n

Affordability is key to homebuyers this spring. \u00a0In 26 of the 32 markets with double-digit sales growth, the typical home sold for less than the national median of $269,200. Meanwhile, expensive markets in the West continue to lag the nation. Sales grew by less than 1 percent from last year in Seattle, San Francisco, San Diego and Riverside, California<\/span>\u2014<\/span>and fell in Los Angeles, Portland, Denver and Sacramento.<\/span><\/p>\n

Also making an impact among spring buyers were rock-bottom 30-year mortgage rates, which reached <\/span>three-year lows this spring<\/span><\/a>, at 3.6 percent. <\/span><\/p>\n

\u201cMove-up buyers have specifically noted they are buying now to take advantage of still-low mortgage rates,\u201d said <\/span>William Porterfield<\/span><\/a>, a Redfin agent in Little Rock, where sales increased 33 percent from a year ago. \u201cThey\u2019re focused on buying as much house as possible while interest rates are so low.\u201d<\/span><\/p>\n

The shift in the mix of housing activity away from expensive coastal markets and toward affordable ones in the middle of the country kept a lid on price growth. May\u2019s median home sales price rose by just 4.3 percent, down from the 4.8 percent rate posted in April, even though sales grew and inventory shrunk.<\/span><\/p>\n

\"Median<\/figure>\n

As buyers were eager to scoop up existing inventory, sellers pulled back in May. The number of new homes listed fell for the second month in a row, down 2.2 percent from last year. The decline in new listings was especially acute in the Northeast. Boston, New York\u2019s Hudson Valley and Wilmington, Delaware all saw 18 \u00a0percent year-over-year declines. \u00a0<\/span><\/p>\n

Overall home inventory decreased for the eighth-consecutive month in May, falling 6.6 percent. This was the largest year-over-year decline in the number of homes for sale in nearly three years.<\/span><\/p>\n

\"Inventory\"<\/figure>\n

May was the fastest market on record since we began keeping track in 2009. The typical home spent 42 days on the market, a full week faster than the same time last year. Even the affordable markets could not avoid the intensity of the 2016 market. Sacramento, Salt Lake City, Grand Rapids and Omaha all saw their typical home sell within two weeks last month. \u00a0\u00a0\u00a0<\/span><\/p>\n

The average sale-to-list price ratio was also the highest recorded since at least 2009, clocking in at a record 95.3 percent, up from 94.6 percent a year earlier. With inventory continuing to fall and all indicators suggesting that mortgage rates won\u2019t rise before autumn, the market\u2019s intensity is unlikely to diminish as we head into summer.<\/span><\/p>\n

\"Average<\/figure>\n

Other May Highlights<\/b><\/h3>\n

Prices<\/b><\/p>\n