Homebuyers need to be prepared to act and act fast, as homes are “flying off the market” at speeds not seen in six years, a new report from Zillow shows.
According to Zillow’s June Real Estate Market Report, on average, homes are staying on the market for just 78 days, which is an average of one week faster than one year ago.
According to Zillow, the 78-day average includes the time it takes to close, which is usually one or two months after the home goes under contract. That means that homes are pending within about a month of being listed.
And that means that homes are closing faster right now than at any point since 2010, according to Zillow.
The length of time that homes stay on the market before selling has steadily decreased since 2010, when homes took an average of five months to sell, Zillow notes.
The largest change in the last month among biggest U.S. metro areas was in Pittsburgh, Philadelphia and Charlotte, as the average time on market for a home dropped by at least two weeks in each metro area.
The available inventory, or lack thereof, is ensuring that buyers need to be prepared to act quickly when they find a home they like, Zillow said, because it may be gone fast.
According to Zillow, the supply of homes for sale is roughly 5% lower than it was a year ago, and 38% lower than its peak level in 2011.
“The low inventory and quick-moving market combine to create a competitive home shopping market, especially for potential buyers looking for less expensive homes,” Zillow’s report stated. “The most expensive third of the market has experienced the smallest drop in available inventory compared to the rest of the market.”
According to Zillow’s report, the limited supply of homes is driving home values higher. Per Zillow’s report, the average U.S. home is currently worth $187,000, a 5.4% increase from June 2015.
According to Zillow, home values have been increasing at 5% or faster on an annual basis for the past eight months.
And while those figures may seem positive for people wanting sell their homes, buyers are still facing a potentially rough road to finding a home, Zillow Chief Economist Svenja Gudell said.
“Homes are selling faster than ever as the home shopping season hits its peak,” Gudell said.
“If you’re looking for a home, be prepared to move quickly. Adding to this difficult buying environment is low inventory – there simply aren’t many homes to choose from,” Gudell added.
“And while this looks like a good time to be a seller, potential move-up buyers may hesitate to list their homes and become buyers,” Gudell concluded. “Until the supply increases, it will remain a tough market to find a home.”