Home prices continued their seasonal decline in September despite the uptick in demand. The median home price was $221,900 according to the National Association of Realtors; this was a decrease of 2.9% from August and a year-over-year increase of 6.1%. As we move into the fall months, we should begin to see some seasonal alleviation on prices; however, year-over-year gains will likely remain strong.
Homes sold at a seasonally adjusted annual rate of 5.55 million homes in September, an increase of 4.7% from August, and up 8.8% from the same month last year. As people move to lock in low interest rates at the end of this year, we are seeing a rebound in sales in contrast to the usual seasonal decline.
Inventory- Months Supply
The actual number of homes for sale in September was down 3.1% compared to the same month of the previous year. This led to the months supply of inventory, which measures the relationship between supply and demand, to fall to 4.8 months. This number remains tight as low interest rates spur buyers to enter the market. New home construction has recently shown signs of increasing; however, this recent uptick has not yet been enough to alleviate pressure on existing homes.