Lack of Inventory was Buyers’ Biggest Hurdle in June

Published by on July 1, 2020

Key Highlights:

  • National inventory declined by 27.4 percent year-over-year, and inventory in large markets decreased by 26.5 percent
  • The inventory of newly listed properties declined by 19.3 percent over the past year, and 16.2 percent in large markets
  • The June national median listing price was $342,000, up 5.1 percent year-over-year
  • Nationally, homes sold in 72 days in June, 15 days more slowly than last year®’s June housing data release reveals that despite continued declines in newly listed properties compared to last year, and despite the pace of home sales continuing to slow, home listing price growth continued to display sustained strength. Additionally, larger metropolitan areas fared better than other markets across the country due to higher price growth, lower declines in newly listed properties, and less stagnant housing inventory. However, with interest rates at all-time lows and buyers returning to the market armed with post-quarantine housing wishlists, sellers appear to be the missing link to a strong summer housing market.

New Listing Trend Improves Compared to May, but Stalls in June

The total number of homes available for sale continued to be constrained in June. Nationally, inventory decreased 27.4 percent year-over-year, a faster rate of decline compared to the 19.9 percent year-over-year drop in May. This amounted to a loss of 363,000 listings compared to June of last year. The volume of newly listed properties in June decreased by 19.3 percent since last year. While still well below last year’s levels, the rate of decline in newly listed properties has improved from a decline of 44.1 percent year-over-year in April, and a decline of 29.4 percent year-over-year last month. However, the weekly progression of the data shows that the rate of decline of new listings has not changed much over the 6-week period ending June 27th, with each week posting year-over-year declines of 17 to 23 percent. While more sellers are comfortable entering the housing market compared to April, the lack of further improvement in newly listed properties signals that a return to normal conditions for the housing market is still just beyond reach at this time. Also, a failure of new listings to improve beyond the current pace could prove to be an obstacle for further sales improvements, given their strong correlation with sales.

Housing inventory in the 50 largest U.S. metros declined by 26.5 percent year-over-year in June. This is an acceleration compared to the 21.9 percent year-over-year decline in May. Overall, new listings only decreased 16.2 percent year-over-year in the nation’s 100 largest metros, less than the national rate, indicating that the nation’s largest metros could be recovering more quickly than other areas across the country.

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