Starting with the basic ARMLS numbers for June 1, 2018 and comparing them with June 1, 2017 for all areas & types:
- Active Listings: 16,018 versus 12,129 last year - down 13.3% - and down 1.9% from 16,329 last month
- Under Contract Listings: 11,399 versus 12,129 last year - down 6.0% - and down 8.8% from 12,504 last year
- Monthly Sales: 10,081 versus 9,858 last year - up 2.3% - and up 9.8% from 9,178 last month
- Monthly Average Sales Price per Sq. Ft: $164.03 versus $150.51 last year - up 9.0% - and up 0.7% from $162.81 last month
- Monthly Median Sales Price: $262,900 versus $240,000 last year - up 9.5% - and up 3.9% from $253,00 last month
May was a weaker month for new listings , down about 1% compared to last year. This was a contrast to April which had seen a stronger rate than 2017. We normally see total supply drop between and June and we still expect this downward trend to continue until September.
The sales count for May was very strong, topping 10,000 for the first time since 2011. However, the number of listings under contract at the beginning of June is much lower than last year - down 6%. Even with this possible sign of wavering demand, supply is so weak that sellers still have advantage in negotiations. This situation inevitably leads to price increases and the annual rate of change has reached 9% for average $/SF and 9.5% for median sales price.
The rise in interest rates does not tend to lower demand, in the current circumstances it can lower supply too. Home owners with an existing mortgage will be less inclined to move if their next mortgage is going to be at a much higher rate than their existing one. This is more likely to be the case with every passing month. As a result, we do not see prices as likely to fall because of interest rates, but we do anticipate limited growth in sales volume.
Source: The Cromford Report by Michael Orr