Zillow reports that residential property inventories are improving in many of the 99 metro areas it surveys and have seen a 5.3% overall increase from January to June. Some 30 metros experienced significant inventory improvement, the biggest of which occurred in Phoenix, San Diego and Minneapolis. Some areas are getting worse, however, and the hardest hit among them are Las Vegas, Chicago and Washington, D.C. Experts note that tight inventory has played a role in boosting home prices during the recovery and the new homes coming on to the market are expect to slow price growth moving forward. For more on this continue reading the following article from Property Wire.
The number of homes on sale nationwide in the United States has fallen this month compared with June 2012 but has improved since the beginning of the year, the latest data shows.
It means that national inventory shortages have eased with the overall listings on Zillow down 12.2% year on year, less than the 17.5% recorded in January.
That means that inventory of homes for sale improved by 5.3% between January and June, according to the online real estate market firm’s latest figures which cover 99 of the larges metro in the US.
Overall, year on year inventory levels improved in June compared to January in 70 metros and the nation as a whole. Among the 30 largest metro areas covered by Zillow, those with the highest degree of year on year inventory improvement between January and June include Phoenix with a 31.9% improvement, San Diego with 14.9% improvement and Minneapolis with a 13.5% improvement.
Inventory shortages worsened between January and June in 29 metro areas overall, and in 11 of the top 30 largest metros. Large metros where inventory constraints have tightened the most since the beginning of the year include Las Vegas with a 21.8% worsening, Chicago with a 12.3% worsening and Washington, D.C. with a 9.8% worsening.
‘As the recovery has progressed, inventory constraints have played a major role in rapidly pushing up home values in many areas, as increasing demand for homes ran headlong into limited supply. It has always been just a matter of time before more supply came on the market to meet this demand, as home builders built more new homes and sellers entered the market to capitalize on recent robust appreciation in their own homes,’ said Zillow chief economist Stan Humphries.
‘Inventory will likely remain below year ago levels for a while yet, as builders ramp up capacity and sellers wait to squeeze every drop of equity from their home before listing. But a corner has been turned,’ he pointed out.
‘Going forward, as this new supply makes its way to market, we expect the pace of home value appreciation to slow down from unsustainably high annual levels of 5% or above to more moderate levels closer to historic norms of 3% or 4%,’ he added.
Nationwide, the greatest year on year decreases in inventory were among more expensive homes, with the availability of top tier and middle tier properties each falling 15.7% year on year. The number of bottom tier properties for sale on Zillow nationwide fell only 2.5% in early June compared to June 2012.
This article was republished with permission from Property Wire.