The red-hot housing market is still on fire.
The Buffalo Niagara housing market stayed smoking hot in April as the spring home-buying season began.
Home prices are rising fast – 8 percent in April – because there are more people looking to buy a home than there are homes for sale. That makes the hunt for a new home harder. With fewer new homes being put up for sale, buyers don’t have as many choices as they search for a house, which often leads to bidding wars and gives sellers the upper hand.
As a result, fewer homes are selling, but that decline is a sign of strength in the local housing market, rather than an indication of weakness.
And there is no sign that’s about to change, with fewer homes being listed for sale during each of the last six months, according to the Buffalo Niagara Association of Realtors.
“Low inventory should continue to create a competitive situation for buyers, causing price increases over the next several months,” the real estate group said.
Local home prices still are rising faster than they have in more than 20 years.
The median sale price of homes sold in April rose by 8 percent, compared with a year ago. And in a sign of just how hot the local housing market has been, the April increase was the smallest single-month price increase in 10 months. Median prices have increased at an annualized pace of at least 8 percent for 10 straight months.
Home sales plunged during April, falling by nearly 20 percent.
The reason: The tight supply of homes for sale made it harder for buyers to find a house they liked. And when buyers did find one, they generally had to pay more for it because of the increased competition.
That isn’t changing: Pending sales, which are deals that have been signed but haven’t closed, dropped by almost 12 percent during April.
You’d have to go back at least 20 years – and probably many more – to find an April where there were fewer homes up for sale.
The shortage of homes for sale – 2,533 were listed in April – is spurring competition among buyers and pushing up prices. But it isn’t prodding homeowners into putting their houses on the market. New listings were down by 11 percent in April.
It’s a seller’s market – and that means homes are selling fast.
Homes in April sold after being on the market for an average of 56 days. That’s seven days faster than a year ago and 25 days faster than in 2015.
Sellers are getting more than 97 percent of their most-recent asking price. And the supply of homes for sale is down to just 2.5 months, far below the six-month supply that signals a market where buyers and sellers are on equal footing.