Trulia: Falling Inventory Has Led To Hurried Homebuying

2017-06-28 / @newswire

SAN FRANCISCO, June 28, 2017 /PRNewswire/ -- Trulia, a home and neighborhood finder for homebuyers and renters, today released the findings from the Trulia (R) Inventory and Price Watch. This quarterly look at the supply of starter, trade-up and premium homes on the market nationally and in the 100 largest U.S. metros found that falling inventory is strongly correlated with how long homes stay on the market.

Trulia Inventory and Price Watch Q2 2017

U.S. Home Inventory Declines 8.9% Year-Over-Year
Between April and June, U.S. home inventory tumbled 8.9% nationally year-over-year, and has now fallen for a record nine consecutive quarters. Inventory today is 20% lower than it was five years ago with the current number of starter and trade-up homes on the market decreasing 15.6% and 13.1% respectively, during the past year. Meanwhile inventory of premium homes has fallen by just 3.9%.

Affordability Becomes Further Out of Reach for First-Time Homebuyers
Falling inventory has also pushed affordability of homes across all segments to new post-recession lows. A typical starter-homebuyer would need to dedicate 39.1% of their monthly income to buy a starter home - a 3.1-point increase from last year - while trade-up homebuyers need 26.0% more than this time last year. Premium homebuyers fared the best as they need to shell out 14.3% more of their income.

2017 Q2 National Inventory and Price Watch
Housing Segment	2017 Q2 Inventory				Change, 2016 Q2 - 2017 Q2
Housing Segment	Median List Price	Share	Inventory	% of Income Needed to Buy Median Price Home in Segment	% Change in Median List Price	Percentage Point Change in Share	% Change in Inventory	Additional Share of Income Needed to Buy a Home (Percentage -Point Change)
Starter	$169,129	22.1%	239,634	39.1%	8.6%	-0.9 pts	-15.6%	+3.1 pts
Trade-Up	$293,799	22.1%	241,652	26.0%	6.9%	-1.0 pts	-13.1%	+1.7 pts
Premium	$626,535	55.8%	593,750	14.3%	7.5%	+2.0 pts	-3.9%	+0.9 pts
Among the 100 largest U.S. metro areas. Share is the percent of for-sale homes that fall into each segment, which is defined separately for each metro. Median price for each segment is the stock-weighted average of the median price of each segment in each metro. Some point change estimates may be slightly different than stated values because our differing procedure occurs before rounding. The full data set can be downloaded here.

Amid Falling Inventory, Fewer Homes Stay on the Market After Two Months
Across metros, falling inventory strongly correlates with how long homes stay on the market. On average, the more a market's housing inventory has fallen over the past five years the faster homes come off the market. In 2012, 57% of homes nationally were still on the market after two months, while today that number has fallen to 47%.

Housing markets with the largest decreases in inventory during this time have also seen significantly fewer homes for sale after two months. Hurried homebuyers this spring can mostly be found in the West, except for Columbus, Ohio, while the slowest moving markets are predominately in the South and Northeast.

America's Fastest Moving Markets
U.S. Metro	% of Homes on Market after Two Months (April 1 - June 1, 2017)	5-Year % Change in Housing Inventory, 2012-2017
San Jose, CA	20.0%	-44.2%
Oakland, CA	20.3%	-30.5%
Seattle, WA	21.9%	-45.6%
San Francisco, CA	23.7%	-31.7%
Salt Lake City, UT	26.0%	-61.2%
Tacoma, WA	27.7%	-42.2%
San Diego, CA	28.2%	-55.8%
Colorado Springs, CO	31.6%	-54.8%
Columbus, OH	32.8%	-56.2%
Denver, CO	33.6%	-43.2%

QUOTES FROM TRULIA'S CHIEF ECONOMIST RALPH MCLAUGHLIN:

"Markets that have witnessed larger decreases in inventory have experienced larger declines in the share of homes still sitting on the market after two months. With these declines, falling inventory has also pushed affordability of homes across all segments to new post-recession lows."

"As inventory continues shrink, the few homes that are available are flying off the market within a couple of months. In the tightest markets in California, only 1 in 4 homes are still on the market after two months. Clearly, this spring is not bringing the inventory relief buyers so desperately need. In today's frenzied market, buyers must be prepared to (1) move fast, (2) be flexible with sellers' timelines, and (3) make multiple offers."

About the Trulia Inventory and Price Watch
The Trulia Inventory and Price Watch offers buyers and sellers deeper insight into the change in supply and affordability of homes over the past year, within three different segments of the market: starter homes, trade-up homes, and premium homes. Based on the for-sale homes listed on Trulia, this report calculates housing inventory within each segment nationally and in the 100 largest U.S. metros, from Jan. 1 to March 1, 2017. For the full report and methodology, see here.

About Trulia
Trulia (R) is a vibrant home shopping marketplace, focused on giving homebuyers, sellers, and renters the information they need to make better decisions. On mobile and the Web, Trulia provides house hunters with insights and unique information about properties, neighborhoods, and real estate agents. Additionally, Trulia offers data and information about schools, crimes, commute times, and the real estate market.

Launched in 2005, Trulia is based in San Francisco and is owned and operated by Zillow Group (NASDAQ: Z and ZG).

Trulia is a registered trademark of Trulia, LLC.

MEDIA CONTACT:
Debbie Baratz
pr@trulia.com

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