As the traditional selling season commenced in April, U.S. homebuyers took more tours and made more offers for their dream properties compared to the previous month, resulting in a 9.2% increase in the Redfin Housing Demand Index released Tuesday.
The index, compiled through tours and offers made by thousands of Redfin customers, rose to a seasonally adjusted 121 in April from 108 in March.
A reading of 100 represents the average level of the three-year period from January 2013 to December 2015, according to Redfin.
The number of buyers requesting tours increased 12.1% in April from March, while the number of buyers writing offers was up 6.9%.
Compared to March, there were 13.1% fewer homes for sale in April, marking the 23rd consecutive month to see the home inventory shrinking. However, limited inventory failed to curb buyers’ enthusiasm as the historically low mortgage rates continued to offer a compelling buying opportunity.
“A pop of new listings only encourages more homebuyers to barge their way into this crowded and competitive, low-inventory market in order to take advantage of still-low mortgage rates,” Nela Richardson, chief economist at Redfin, said in the report. For these reasons, we expect prices to continue to grow above their three-year average for the remainder of the year.
U.S. median home sales prices rose 6.2% in April to $280,000, continuing a five-year upward trend, according to a separate Redfin report published earlier this month.
At the metro level, Seattle is poised to become the most competitive area, as supply decreased 35% year-over-year in April while the number of buyers making offers increased 36.9%.
Housing demand in Washington D.C. has also been picking up steam. In April, Redfin’s demand index for the nation’s capital increased 26.4% month over month. The number of buyers requesting tours surged 50.2% compared to a year ago. But potential buyers are taking time to make purchases, as the number of those actually writing offers only increased 3.6%.
— Mansion Global (@MansionGlobal) May 26, 2017
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