For the fourth month in a row, the RE/MAX National Housing Report is showing an increasing median home price in 53 markets nationwide. In May, home prices were 6.1 percent higher than those the previous May. Home sales also rose above the mark set last year by a significant 12.8 percent. With 42 surveyed metros showing increases in both sales and prices, the housing recovery appears to be taking hold in all regions of the country, according to RE/MAX.
For 11 months in a row, home sales have exceeded the level of the same month a year ago. Inventory continues to fall significantly lower than the previous year, with a 26.6 percent drop from May 2011.
"Clearly, 2012 is the year the housing industry has been waiting for; there's a broad-based recovery taking hold," said Margaret Kelly, CEO of RE/MAX, LLC. "This recovery may not bring improvement in all sectors to all markets at the same time, but most markets across the country are experiencing the best selling season they've seen in years."
Transactions — Year over year change
In the 53 markets surveyed for the May RE/MAX National Housing Report, closed transactions rose 12.6 percent from the previous month and 12.8 percent from the same month last year. May is the 11th consecutive month to report home sales at a higher level than the previous year. Strong sales trending higher each month are driving an undeniable recovery in all regions of the country. Of the 53 metro areas surveyed, a record 48 saw sales higher than one year ago, and of those, 38 saw double-digit increases including: Burlington, Vt., up 39.3 percent; Albuquerque, N.M., up 35.8 percent; Boston, Mass., up 29.3 percent; Chicago, up 28.1 percent; Nashville, Tenn., up 27.1 percent; and, Raleigh-Durham, N.C., up 25.7 percent.
Median sales price
The media sales price of homes sold in May was $166,500. This price marks a 4.1 percent rise from the median in April and a 6.1 percent increase from May 2011. May also marks the fourth month in a row to record a year-over-year increase. Of the 53 metro areas included in the May RE/MAX National Housing Report, a record 46 experienced price increases over last year, with 9 metro areas seeing double digit gains including: Phoenix, Ariz., up 34.5 percent; Detroit, Mich., up 23.1 percent; Boise, Idaho, up 23 percent; Denver, Colo., up 14.8 percent; Miami, Fla., up 14.3 percent; and San Francisco, up 11.9 percent.
Days on market — average of 53 metro areas
May saw another drop in the average day on market for homes sold during the month. The average fell to 92 days, significantly lower than April's average of 96 and slightly lower than the average in May 2011 of 94. In the last 12 months, the average fell below 90 only twice — July and September 2011 both reported 88. This level could be reached again this summer as transactions rise and inventory falls. Days on market is the number of days between first being listed on a listing service and when a sales contract is signed.
Months supply of inventory — average of 53 metro areas
In the month of May, the inventory of homes for sale fell 4.2 percent from April and 26.6 percent from the inventory level seen in May 2011. Inventory continues to drop due to fewer foreclosure properties coming to market. Month-to-month inventories have now fallen for 23 consecutive months. A diminishing inventory is helping home prices rise. Given the current rate of sales, the average supply is now 4.9, about a half month lower than the 5.3 average for April, but a full two months lower than the 6.9 supply of May 2011. The supply measures the number of months it would take to clear a market's active inventory at the current rate of sales. A six-month supply is considered a balanced market between buyers and sellers.