REAL ESTATE MARKET SPEEDS UP – FASTEST REAL ESTATE MARKETS ACROSS THE COUNTRY
Very good snap shot of National market including Atlanta Stats
Low Supply and High Demand are Largely Responsible, but Technology is also Creating a “New Normal” for the Expected Pace of Home Buying and Selling
Ask a friend who’s trying to buy a home what the real estate market is like, and she will surely describe it as “fast” or a synonym thereof. And your friend is right! To address this new reality, Redfin has developed a new monthly report focused solely on the speed of home sales.
In April, the percentage of homes that went under contract within two weeks increased by 39 percent since the same time last year and by 3 percent from March. Homes going under contract in one week increased 54 percent from last year and by 2 percent since March. Both measures set a new record since at least January 2011, when Redfin began tracking this data.
Several factors are contributing to the market’s need for speed these days. Demand is high and supply is low, which forces people to make decisions very quickly. Also, new technology is compressing the timeline from listing to tour and offer. Today, people can find out within minutes when a new listing has hit the market and to schedule an in-person home tour with real estate agent, all from a smartphone. While market conditions like supply and demand will fluctuate over time, changes brought about by technology are most likely creating a “new normal” for the overall pace of home buying and selling.
“I’ve been seeing more homebuyers writing pre-emptive offers in an effort to get under contract before a bidding war erupts,” said Mia Simon, a Redfin agent in Silicon Valley. “Typically, these pre-emptive offers are well above asking price, non-contingent, and from homebuyers who have already lost out in several bidding wars.”
The Redfin Fastest Real Estate Markets Report ranks 22 markets across the country measured by the percentage of homes that went under contract within two weeks of their debut in April 2013. The metrics include single-family homes, condos, and townhouses.
Other key findings:
- The fastest-moving market in April was San Jose (Silicon Valley), California, where nearly two-thirds of new listings were under contract within two weeks, and there was less than one month of supply.
- The slowest-moving markets were Triangle, NC (Raleigh-Durham) and Philadelphia, each of which saw 10% of homes under contract within two weeks.
- Denver is the only market among the five fastest that is not in California.
- Atlanta and Philadelphia are the only metro areas considered buyer’s markets, with 6.9 and 8 months of supply respectively.
- Miami has shown the most dramatic acceleration over the last year, with a 149% increase in the percentage of homes going under contract in two weeks, followed by Atlanta at 123%.
- Miami also led the nation with the largest (45%) month-over-month increase in the rate of homes going under contract in 14 days, followed by Denver at 15%.
- The Chicago and Phoenix markets slowed down in the last year, with 22% and 16% drops in their respective rates of homes going under contract within two weeks.
- In the last month, four markets decelerated, seeing a month-over-month decline in the percentage of homes that went under contract in 14 days. They were Chicago (-23%), Las Vegas (-3%), Phoenix (-2%), and Dallas (-1%).
Below is a ranking of 22 real estate markets by speed, measured by the percentage of homes that went under contract within two weeks of their debut in April 2013.
Table 1: Speed by Market, April 2013
|Speed Ranking||Market||Pending in 2 Weeks||Pending in 1 Week||# Flash Sales||Months of Supply|
|#1||San Jose, CA||65%||20%||48||0.9|
|#2||San Francisco, CA||57%||20%||81||1.5|
|#6||Los Angeles, CA||51%||30%||236||1.4|
|#8||San Diego, CA||49%||30%||63||1.4|
|#9||Inland Empire, CA||48%||31%||88||1.8|
|#20||Las Vegas, NV||12%||7%||8||4|
Accelerations from December to March
Last year, the market sped up dramatically between December and March, with the percentage of homes going under contract within two weeks increasing from 14 to 22 percent. Starting in April, the speed plateaued at about 23 percent for the rest of the year. This year, the same pattern is repeating, with the two-week rate shooting up from 22 percent in December 2012 to 31 percent in March, and then steadying at 33 percent in April.
Months of Supply Inched Up from March to April
Thanks to the uptick in inventory we covered in this month’s Real-Time Price Tracker, months of supply eased somewhat, increasing from 3.2 in March to 3.5 in April. Still firmly in seller’s market territory, but a move toward a more balanced market gives some hope for buyers.
Here’s a more detailed look at four key speed metrics over the last couple of years.
Table 2: National Market Speed 2011 to 2013
|Month||Pending in 2 Weeks||Pending in 1 Week||# Flash Sales||Months of Supply|
by Rachel Musiker | Redfin