Low interest rates and sparse inventory are leading to a highly competitive market for buyers, according to Realtor.com’s Weekly Recovery Report for the week ending July 11.
The report also found that the U.S. housing market is returning to pre-COVID-19 levels, with a Housing Market Recovery Index of 98.5, which is just 1.5 points below the pre-COVID baseline and 0.7 points higher than the previous week. The baseline market level was determined by a comparison to January, prior to the effects of COVID-19 on the market.
Both total inventory and new listing were down, by 32% and 19%, respectively, partially due to increased buyer demand. Time on market was on average one day longer than last year, and median listing prices grew 7.9%.
“Today’s market remains tipped in favor of sellers as would-be spring buyers are shopping well into what would normally be summer vacation season,” said Danielle Hale, chief economist for realtor.com. “Home buyers, trying to take advantage of record-low mortgage rates and make up for lost time, are finding limited and more expensive options. Although sellers are slowly acclimating to this unexpected surge in buyer interest, inventory is still lagging behind demand which is driving quick time on market and listing price growth on par with this time last summer.”
Chicago was found to be trailing the national average with a Recovery Index score of 92.7, up by 0.2 points from the previous week’s score. The Midwest region continues to lag behind the national average, with a Recovery Index score of 95.3, and seems to be slowing down, according to Realtor.com.