Housing Market Documents Record Growth Across the Country
The housing market just recorded its fastest monthly growth rate on record, according to real estate brokerage firm Redfin. As of May, homes around the country are selling at speeds a full week faster than last year, spending only a median 42 days on the market.
The acceleration is the greatest Redfin has ever seen since they began recording their statistics in 2009. Homes in hot West coast markets like California, Washington, and Colorado frequently see closings in ten days or fewer, but a large majority of the growth stems from Midwest and Southern states, where prices are more affordable than ever.
Detroit and Grand Rapids in particular saw extreme growth levels, with a more than 50% increase since this time last year. “Locals are watching prices rise, and many realize if they don’t buy soon, they’ll miss out while homes are still affordable,” said local Redfin agent Kent Selders. “The result is incredible demand and rapid sales. Nothing like this has ever happened in Grand Rapids.”
Buyers are taking full advantage of falling mortgage rates, which are currently at a three-year low. Long-term mortgages were as little as 3.3% at the end of 2012, but current rates continue to decrease.
“After almost a decade of undersupplied housing stock, competition is fierce,” Redfin chief economist Nela Richardson said. “We’re seeing the intensity of fast sales and bidding wars even in affordable markets like Grand Rapids and Omaha, where the typical home sold within two weeks last month.”
Nearly one-third of markets across the country saw double-digit increases over the previous year, including Little Rock, Arkansas, where Redfin agent William Porterfield says the 33% growth is the result of more people being able to upgrade from their previous homes.
“Move-up buyers have specifically noted they are buying now to take advantage of still-low mortgage rates,” he said. “They’re focused on buying as much house as possible while interest rates are so low.”