By Jim Perskie
A pair of housing reports released Tuesday provided fresh insight into the strength of the housing market early in the year – and how the sector is slowly starting to rebound from the challenges created by the coronavirus pandemic.
The National Association of Realtors reported that 96 percent of the nation’s metro areas experienced price increases in the first quarter, with 174 of 181 markets showing price gains from the same period in 2019.
At the same time, Zillow said more houses are coming on to the market in recent weeks after bottoming out last month – though remain far below the 2019 levels.
“The first quarter price jumps mostly reflect conditions prior to the coronavirus outbreak and show the strength of the housing demand prior to the pandemic,” NAR chief economist Lawrence Yun said. “Even now, due to very limited listings, home prices are showing no signs of buckling.”
In March, the median sales price of existing homes rose 8 percent on a year-over-year basis, driven in part by low inventory.
“Supply is extremely limited, and there are simply not as many homes for sale to meet the demand among potential buyers,” he said. “More supply and more listings are needed to provide a faster recovery for the economy.”
Zillow’s report shows that there were 6.8 percent more new listings in the United States for the week ending May 3, which was still 39.2 percent lower than in 2019. Compared to last year, there were 62.3 percent fewer new listings in New York City, 60.9 percent fewer in Detroit, 59.8 percent fewer in Pittsburgh, 51.8 percent fewer in Boston, and 51.2 percent fewer in Philadelphia.
Still, Zillow is seeing it begin to turn around – with significant week over week increases in Los Angeles (13.1 percent), Detroit (12.4 percent), Riverside, California (24.4 percent), San Diego (13.5 percent), Portland (13 percent) and Denver (59.1 percent), to name a few.
“Many sellers with the flexibility to delay or temporarily remove listings have opted to do so, perhaps waiting out the uncertainty,” said Skylar Olsen, senior principal economist at Zillow. “Now that more buyers are in the market, those sellers are wading back in, joining those who had remained motivated to sell for any number of life reasons and adapted with virtual tools and social distancing.”