Housing markets in tech hubs likely to recover faster from pandemic
Nationally, real estate activity is inching closer to January trends and the housing markets in tech hubs are the ones expected to make the quickest recovery from the pandemic, realtor.com said.
According to the latest Housing Recovery Index from realtor.com, Denver, Boston, Seattle, San Francisco and San Diego are leading the recovery this week. These hubs scored 107.6, 106.7, 106, 104.5 and 104.5 points, respectively, for the week ending June 13.
The index is set to 100 for the last week of January. A value of 100 means the market has recovered to the pace seen that month, the company said.
In the U.S., the overall weekly index value is calculated as a weighted composite of four indexed components, including “housing demand,” based on realtor.com online search activity (10%); “home prices” based on median list prices (30%); “housing supply” based on new listings (30%); and “pace of sales” based on median time on market (30%).
Nationally, the Housing Recovery Index was at 90 for the week ending June 13, up 1.2 points over the week ending June 6 and 10 points below the January trend baseline.
National housing demand, which tracks growth in online search activity, reached 123.3 last week. This is up 9.3 points from the week prior and 23.3 points above January’s baseline. The home price component, tracking growth in asking prices, inched forward 0.3 points from the week prior, reaching 101. The new listings tracker reached 88, up only 0.7 points from the week prior. The time-on-market index reached 69.9, flat from the week before and well below January’s baseline.
Locally, realtor.com said that an additional four markets crossed the recovery benchmark this week, bringing the total number of markets above the January baseline to eight.
In terms of local housing demand, all 50 of the largest markets realtor.com monitors are positioned above the recovery trend. The most-recovered markets for home-buying interest are Miami; Birmingham, Alabama; Atlanta; Riverside, California; and Seattle, where the housing demand growth index laid between 138 and 151.7, the report said.
Home prices have recovered in 15 of the 50 largest markets, as median list prices have surpassed the January baseline and growing at 9% year over year. The median list price in the top 10 most and least recovered markets were at $341,000 and $501,000 on average. Some of the most recovered markets for home prices are Pittsburgh; Louisville, Kentucky; Minneapolis; Cleveland; and Providence, Rhode Island with a home price growth index between 104.4 and 110.9.
Local housing supply has reached a record high in 12 of the 50 largest markets, also surpassing January’s baseline. However, this is still low.
Listings are down 12% year over year in the 10 most recovered markets, but markets that had the most supply recovery include Denver; San Francisco; Seattle; Pittsburgh; and Miami as the new listings growth index lies between 104.3 and 118.
There were only eight of the 50 largest markets to see time on the market surpass the January baseline, realtor.com said. The median time on market in the top 10 most and least recovered markets sat at 42 and 64 days respectively on average.
Of the most recovered markets for time on the market are Boston; San Diego; Rochester, New York; Los Angeles; and Louisville, Kentucky, with a pace of sales growth index between 105.2 and 113.7.
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