Housing inventory low as sales remain strong
December 20, 2017, 4:18pm
BOONE - With one month remaining in the calendar year, local Realtors® are poised to see sales growth for a seventh consecutive year. It’s been so busy, local inventory is near a three-year low.
Sales in November mirrored those of a year prior, according to the High Country Multiple listing Service (MLS), which tracks Realtor® sales in Alleghany, Ashe, Avery and Watauga counties.
Interest rates, which have fluctuated for months, have held steady since October.
Local Realtors® sold 190 homes worth $53.67 million in November, according to the MLS. The average sold price - total value divided by homes sold - was $282,499.
The average sold price was just a tad lower than that recorded in October ($282,676), though total sales month-to-month declined 19 percent (234 to 190). That mirrored what happened a year ago, when sales declined month-to-month by 21 percent (244 to 192).
For the year, local Realtors® have sold 1,975 homes worth $513.36 million. That’s above last year at this time, when they sold 1,955 worth $480.32 million.
The activity has impacted inventory. As of December 17, there were 1,891 active listings within the MLS. That is similar to levels recorded in January. From 2014 to 2016, inventory never dropped below 2,000.
Local inventory trends are similar to what is being recorded nationally. The latest housing report by the National Association of Realtors® (NAR) said that, while sales increased in October at the strongest pace seen in months, continued supply shortages led to fewer closings.
"While the housing market gained a little more momentum last month, sales are still below year ago levels because low inventory is limiting choices for prospective buyers and keeping price growth elevated,” said Lawrence Yun, NAR chief economist.
Yun indicated that the impact of Hurricanes Harvey and Irma are still being seen in Texas and Florida, but “sales should completely bounce back to their pre-storm levels by the end of the year, as demand for buying in these areas was very strong before the storms.”
Interest rates remain attractive to buyers. The average 30-year fixed rate has held steady since late October at 3.9 percent. As of December 14, it was 3.93 percent, according to loan giant Freddie Mac. It was 4.16 percent a year ago.
The average 15-year fixed rate was 3.36 percent. It was 3.37 percent a year ago.
The day prior to the latest interest rates being announced, the Federal Reserve raised short-term interest rates for the third time this year. According to a Freddie Mac release, "The market had already priced in the rate hike, so long-term interest rates, including mortgage rates, hardly moved.”
Nonetheless, some analysts expect the Fed’s rate hike to eventually push the rate on 30-year fixed mortgages past the 4 percent mark.