With the exception of 2020, (I wonder how many times that has been said...?) there’s typically a significant month over month increase in home sales in May.
In 2017 there was a 21% increase, in 2018 a 15% increase, and in 2019 a 17% increase.
In 2021? There was a 1% decrease with 554K home sales. So, could the market finally be flattening out a bit after the last few wild months? We have a few theories why this might be happening which has something to do with a formula of:
Low inventory + high velocity + home prices + societal changes = most bizarre year of home sales?
We’ve been discussing this low inventory problem for months, but something else important to consider is the velocity at which homes have been selling. Homes are flying off the market faster than they can be listed, which is great for sellers but makes the buyer’s market rough. Very similar to when the job market is tight and prospective employees finally give up after being turned down after their 8th or 15th interview, prospective home buyers at some point and are going to give up.
Another reason we see for this slight slow down is all the swift societal changes we are experiencing. People are finally able to be out doing things outside of their homes so their focus is no longer on their home nest. Airbnb released a Report on Travel & Living in May that shows that people are traveling more and for longer, and with their families. Having freedom from being stuck inside our homes day in and day out could really make a difference in the number of home sales we see.
June and July Home Sales Predictor
So, what could all of this mean for home sales in the coming months?
We predict the number of home sales to have a slight increase in June at 601K home sales and July 583K home sales.
If these predictions hold this would mean June could potentially be our peak so far this year and would be an 8% increase over the previous month and an 18% increase YOY. For July that would be a 3% decrease to the previous month and a 3% decrease year over year.
Only time will tell if this flattening trend will continue or if we will see a spike later this year. Many of our clients have shared with us they are starting to see more listings in their area so maybe we will still see a spike? What trends are you seeing? Do you think we’ve seen the peak?
See you next month!
The Home Sales Predictor is a brand-new set of prediction data that dives into the number of presentations created and the correlated number of U.S. home sales. This data is provided by MoxiWorks with insights from their MoxiPresent product.