Wonder where the market is headed? To predict the trends of the market, we look at the following factors:
- Contract activity
- Urgency Index of Buyers
- Inventory of Available Homes
- Interest Rates & Affordability
Contract activity in May has remained stable, down slightly .4% from May 2015 and average days on market was up slightly to 39 days versus 37 from may 2015.
The urgency index, which is a measure of the percentage of homes going under contract within 30 days of going on the market was down slightly landing at 65.5% compared to 67.6% in May 2015. For reference our highest urgency index of 95% occurred in 2004 and lowest urgency index was 25% in 2007.
The number of homes on the market was down 9.5% when compared to May 2015. There were 16.9% fewer new listings in May 2016 than in May 2015 which means the overall supply is currently 2.1 months, down slightly from 2.3 months in May 2015.
Interest rates have remained unchanged and contributes to increased affordability with homes costing 25.5% less than the peak of the ‘boom’ market.
To summarize we have a mostly ‘normal’ market. Homes priced properly sell relatively quickly and buyers continue to be drawn to areas convenient for commuting, public transportation and with the most walk-ability. Buyers are still concerned about overpaying for a home and proceed with caution as they enter the strict underwriting requirements in obtaining a mortgage.