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Any progress made with loosening housing inventory was lost as a high demand of buyers scooped up homes from the market, but sales still slipped from a year ago, according to Remax.
With a decline of 5.5% in August, housing supply posted its largest drop in 13 months with buyer demand outpacing the number of homes listed for sale, according to Remax’s National Housing Report. Inventory hasn’t taken an annual fall this great since July 2018, when it fell 7.8%.
Despite higher demand for housing, home sales declined 1.6% in August from the prior year, which followed an annual increase in July of 2.3%.
“The modest inventory growth that started last fall has been swallowed up by demand as buyers have returned to the market, likely spurred on by attractive interest rates,” said Remax CEO Adam Contos in a press release.
“Home sales dipping at the same time inventory falls suggests there may have been some reluctance on the part of sellers to list their homes. Nevertheless, demand is again ahead of supply, extending the favorable seller’s market that has been in place for several years,” he continued.
The supply of inventory sunk to 2.8 months, matching a previous August low for the 11-year history of Remax’s report. In 39 of the past 42 months, supply held below 4 months. Six months of supply is considered a balanced market between sellers and buyers, according to Remax.
Notably, property values fell 3.6% month-over-month in August. While it is typical to see a decline from July to August, this marks the greatest home price drop between the months since Remax began tracking this data.