Explosive Market Continues in May

May residential closings in Ada County were 14% higher than they were last May, while pending transactions at the end of this May were 21% higher than they were a year ago.  Inventory is down 8% due to the hot market leaving us with 2.5 months of properties.

Resale closings in May were 10% higher than they were last May, while pending contracts were 12% higher. The inventory of resale properties decreased 17% over the past year, leaving only 57 days of properties available to buy.

New homes made great strides, selling 32% more units than last May and pendings were 43% higher.  Inventory actually increased slightly yet we have only 5.1 months of new homes in various stages of completion available for purchase.

A recent twist is that price increases of resale homes continue to outpace the increases in new homes, 9.3% to 6.5%.

 

April Showered us with Sales

Closings this April outpaced closings last April by almost 15%. This puts us 11% year-to-date ahead of the hot pace of last year.

Can this last?

Inventory is 16% lower than it was at the end of last April and pending sales contracts are 21% higher; yet average prices are up only 7%.  Despite the hot market, we haven’t seen huge increases in prices.

The chart below shows the movement of unit sales and average prices since 2005.

As you can see, the dramatic increase in unit sales in 2006, fueled by the availability of “no doc” loans, created unsustainable price increases which began to correct in 2008.  However, since 2005, average prices have increased only 32%.