Historically low mortgage interest rates plus a shortage of new construction reduced home inventory throughout the country during April, according to a market overview from Summit Valuations, LLC.
“One year ago, there was a 4.4 month supply of listings on the market. The housing inventory has declined over the past twelve months and today, there is a 3.8 month supply of listings on the market,” Summit Valuations Chief Valuation Officer Mark Melikian said in a release accompanying the report.
Melikian said he expects the market to correct itself through an increase in new construction and homeowners forced to sell because of changing life circumstances, such as a new job, a birth or death in the family or a change in marital status.
“Once we see more sellers with a need to sell and an increase in new construction, we'll begin to experience a more balanced market,” Melikian said. “History has taught us that constant price appreciation is not sustainable and does not make a healthy and vibrant market. Since the real estate market is cyclical, it will eventually arrive at this more balanced level of supply and demand.”
Summit’s report is based on March data. It found that median sales price, the seasonally adjusted number of homes sold and mortgage interest rates all saw year-over-year increases in March.
The South had the highest number of existing home sales and the West had the highest median price. All four regions experienced increases in the median sales price month-over-month.