In January, home sales increased by 10.4% while new listings declined by 9.1%.
Are we facing a future with absolutely no inventory for sale?
This chart shows how the inventory has dropped over the past 10 years. In January, the number of home sales surpassed active listings.
It certainly looks like we are running out of inventory really soon.
According the most recent housing report by the Columbus Association of Realtors, the Month’s Supply of Inventory is down to 0.6 months.
This is 50% lower than a year ago.
It means we would sell out in only 2 weeks if no homes were listed for sale.
Why Is the Inventory So Low?
The major reasons for the inventory shortage are high buyer demand and a lack of new listings.
The chart below illustrates the situation well. It compares Closed Sales (left) and New Listings (right) in 2020 (red line) to 2019 (blue line).
It’s easy to see that Closed Sales were much higher in 2020 for most of the year except during the Covid lockdowns in April and May. Over the year, 1,527 more homes sold in 2020 than in 2019.
New Listings dropped substantially in April, May and June of 2020. The rest of the year was very similar like 2019. The red line was barely higher than the blue line. 1,813 fewer homes were listed for sale in 2020 than in 2019.
Exponential Home Value Growth
The next chart shows how the average sales price has increased over the years for the month of January. Home values were up by 15% in January 2021.
Low housing supply and strong buyer demand fueled by low interest rates have accelerated price increases in the past 2 years.
Recommendation for Desperate Buyers
The inventory shortage is not going to ease up anytime soon. If you don’t want to overpay for existing homes, your best bet is new construction.
I may be able to help you snag one of the few spec homes since I am in constant contact with many builders’ reps.
Recommendation for Hesitant Sellers
List your home now! Home values have never been higher. There’s no competition from other sellers.
This may change in the second half of the year when we get out of the Covid pandemic. I expect a lot of pent-up demand from sellers who will enter the market in the second half of this year.
Housing Stats for January 2021
Here’s a summary of home sales data for January 2021 as reported by the Columbus Association of Realtors:
- Closed Transactions – 1,926 – UP by 10.4%
- Inventory – 1,820 – DOWN by 47.2%
- New Listings – 2,187 – DOWN by 9.1%
- Days on Market – 25 – DOWN by 39.0%
- Average Sales Price – $263,455 – UP by 15.0%
- Average Price / Sqft – $146.95 – UP by 15.9%
For details go to Columbus Realtors to see the full report.
Any Questions about Buying or Selling? Call or Text me Today at (614) 975-9650.
Susanne Novak has been a Realtor since 2007. She is the broker and owner of RE/MAX 24/7 in the Dublin Historic District. Susanne typically helps 50-60 families each year with their real estate needs. She's your trusted advisor when you search for your dream home, and a skilled negotiator when she lists your property to get top dollar when you sell.