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Buyer traffic leapt 40 per cent last month, according to the National Association of Realtors, as demand for US real estate continues to grow.
Existing homes sales increased by 0.4 per cent in January to a seasonally-adjusted rate of 4.92 million, 9.1 per cent up from last year, as the country's steady recovery creates a seller's market.
Indeed, property transactions rose in every region of the US except for the West, which is the region most constrained by limited inventory. Tight inventory remains a major factor across the country, explains NAR Chief Economist Lawrence Yun, who suggests that otherwise sales could be even higher:
"Buyer traffic is continuing to pick up, while seller traffic is holding steady. In fact, buyer traffic is 40 percent above a year ago, so there is plenty of demand but insufficient inventory to improve sales more strongly. We've transitioned into a seller's market in much of the country."
Total housing inventory at the end of January fell 4.9 percent to 1.74 million existing homes available for sale, which represents a 4.2-month supply at the current sales pace; the lowest housing supply since April 2005.
Listed inventory is 25.3 percent below a year ago, while raw unsold inventory is at the lowest level since December 1999, when there were 1.71 million homes on the market. The spring bounce will help inventory to grow, suggests Yun, "but it may be insufficient to avoid more frequent incidences of multiple bidding and faster-than-normal price growth."
The lack of inventory, increasing demand and surge in buyer traffic has helped prices to keep on climbing: the national median existing-home price was $173,600 in January, up 12.3 percent from January 2012 – the 11th consecutive month of annual price increases. The last time a run like that occurred was between July 2005 and May 2006. Indeed, January's price jump is the strongest since November 2005, when values rose 12.9 percent from the previous year..
No wonder, then, that homes are selling faster. The typical home is selling nearly four weeks faster than it did a year ago, with the median time on market for all homes just 71 days in January, 28.3 percent below January 2012.
Condo and co-op sales also performed well, with sales rising by 13.7 per cent compared to last year, while prices climbed 9.4 per cent over the 12 months to an average of $169,600.
The trend is set to continue, particularly in hotspots such as Florida, with Miami-Dade county sales of existing single-family homes rocketing upwards by 19.1 per cent compared to this time last year, according to the Miami Association of Realtors.
"The consistent strengthening and improvement of the Miami real estate market is generating much excitement and attention both domestically and internationally," said 2013 Chairman of the Miami Realtors Board Natascha Tello.
Indeed, Miami home prices rose again in January, marking 14 consecutive months of appreciation for both single-family homes and condominiums. The median sales price of single-family homes rose 14.8 percent to $194,000 year-over-year.
"We expect prices to continue to rise as a result of the significant demand that currently exists for both sales and rentals. While more new listings are coming on the market, there still is insufficient supply to satisfy consumer demand and significant fewer new listings in the lower price ranges."
"The current robust performance of the Miami market is not only driving prices but also creating a seller's market," added Residential President Fernando I. Martinez.
"Properties that are priced right are selling very rapidly and generating multiple offers. There are still good opportunities available, but buyers need to be more focused. Sellers who have been hesitant to put properties on the market should consider doing so now. More listings are definitely needed to satisfy demand."
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