Summit Valuations, LLC, a full service valuation company, announced the release of its May Residential Real Estate Market Overview based on data compiled in April 2017. This month’s report includes an analysis of real estate inventory levels and a discussion of why inventory is so low and what the future might hold from Chief Valuation Officer Mark Melikian.
“The number of existing homes for sale nationwide continues to decline,” Melikian said in his report. “One year ago, there was a 4.4 month supply of listings on the market. The housing inventory has declined over the past 12 months, and today, there is a 3.8 month supply of listings on the market.”
Melikian pointed to a number of factors influencing inventory levels today, including the recent period of historically low mortgage interest rates, followed by recent interest rate increases and a shortage of new construction. But Melikian said he expects the market to correct itself in time.
“Once we see more sellers with a need to sell and an increase in new construction, we’ll begin to experience a more balanced market,” he said. “History has taught us that constant price appreciation is not sustainable and does not make a healthy and vibrant market. Since the real estate market is cyclical, it will eventually arrive at this more balanced level of supply and demand.”
On a regional level, the South had the highest number of existing home sales and the West had the highest median price. The West experienced a month-over-month decline in the number of seasonally adjusted existing home sales while all other regions saw month-over-month gains. All four regions experienced increases in the median sales price month-over-month, according to the report.