IRVINE, CA—US home sales volume decreased in February for the fourth consecutive month as distressed sales continued to dry up and institutional investors pulled back, according to RealtyTrac. The firm reports that US residential properties, including single-family homes, condominiums and townhomes, sold at an estimated annual pace of 5,083,241 in February, a 0.2% decrease from the previous month, but still up 7% from a year ago.
“Supply and demand have reached a bit of a standoff in this uneven real estate recovery,” says Daren Blomquist, VP of RealtyTrac. “The supply of distressed properties—which buyers and investors have come to rely on over the past few years—is evaporating quickly in most markets, but that dwindling supply isn’t being adequately replenished by non-distressed homeowners listing their homes or by new homes being built. Meanwhile, a key source of demand over the past two years—institutional investors purchasing single-family homes as rentals—is starting to decline, and it’s not yet clear if that diminishing demand will be filled by first-time homebuyers and move-up buyers.”
Chad Ochsner, owner/broker of RE/MAX Alliance in Denver, says the area’s “historically low inventory is keeping the Denver market from returning to normal.” Sales volume decreased monthly for the fourth consecutive month in February in this market as well. “Homeowners who are ready to sell their homes are not able to find replacement homes due to low inventory levels, causing them to either not sell or to sell and then rent, which is slowing the pace of the market.”
The decrease in sales volume nationwide was driven by monthly decreases in 31 states, according to RealtyTrac. Meanwhile, sales volume decreased on a year-over-year basis in six states, including Massachusetts, California, Arizona and Nevada, and 21 of the nation’s largest metro areas, including seven California markets along with Phoenix, Orlando, Las Vegas and Detroit.
Despite the sales-volume decline, as GlobeSt.com reported last week, 96% of US county residential real estate markets are better off than they were at the height of the foreclosure crisis four years ago, according to a report from RealtyTrac. The firm analyzed four different key categories of housing-market health in 410 US counties to make this determination: home price appreciation, affordability, percentage of bank-owned sales and the unemployment rate. The categories were studied in two-year increments over the past eight years.