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Prices Continue to Climb in November: RE/MAX

By: Tory Barringer 12/18/2012

Even as the market heads into its slow season, sales numbers continued to stand well above their year-ago level in November, according to RE/MAX’s latest National Housing Report.

The report shows home sales were up 15.7 percent year-over-year in November, the second highest annual increase this year (behind October’s 17.8 percent yearly rise). According to RE/MAX, November is the 17th consecutive month in which sales have posted year-over-year increases.

Of the 52 metros included in the survey, 49 reported higher sales than November 2011, and 37 of those markets saw double digit increases, including: Providence, Rhode Island (62.6 percent); Burlington, Vermont (50.8 percent); Manchester, New Hampshire (38.8 percent); Nashville, Tennessee (35.7 percent); Tampa, Florida (35.1 percent); and Boston, Massachusetts (32.0 percent).

Prices also rose both on a month-to-month and year-over-year basis. The median price for homes sold in November was $163,750, 3.6 percent higher than October and 6.9 percent higher than November 2011. November is the 10th straight month to experience year-over-year price gains.

“2012 has been a great turn-around year for housing, with prices and sales moving beyond where we were last year,” said RE/MAX CEO Margaret Kelly. “We’re ending the year the way we started it, with better than expected performance. If we can get more reasonable regulation from Washington and if mortgage availability improves, 2013 will see a much stronger housing market.”

Perhaps the biggest contributing factor the continued rise in prices is a dwindling inventory. The average number of homes for sale in November was about 8.0 percent lower than in October and 29.1 percent lower than the previous year. As of November, month-to-month inventories have now fallen for 29 consecutive months.

The decline in inventory is something of a double-edged sword: While it boosts prices, it also creates difficulties for potential buyers in dried-up markets. According to the report, some areas—including San Francisco and Los Angeles—posted months’ supplies as low as 1.1 months in November, well below the national average of 5.6 months. A balanced market will sit somewhere between five and six months’ supply.

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