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Written by David Dodge

The U.S. housing market is showing signs of recovery as existing-home sales increased for the first time in five months in August 2024. U.S. existing-home sales increased for the first time in five months, as lower mortgage rates and rising supply helped boost market activity According to the National Association of REALTORS® (NAR), sales of previously owned homes rose 1.3% month-over-month to a seasonally adjusted annual rate of 3.95 million units, exceeding economists’ expectations and ending the downward trend of recent months.

August 2024 Update: Housing Trends

The August 2024 update brings fresh insights into the housing market, reflecting the ongoing challenges and opportunities for buyers and sellers.

• New Listings: New listings for residential homes saw a notable decrease, down 17.4%, continuing the inventory challenges in the residential market. In contrast, townhouse/condo homes experienced a 1.8% increase in new listings, which may present more options for those exploring alternative property types.
• Pending Sales: Pending sales remain sluggish, with a 5% decrease in residential homes and a sharp 17.8% decline for townhouse/condo homes. Buyers are navigating affordability concerns, and this could lead to longer transaction times and more competition for affordable properties.
• Inventory Trends: Inventory decreased by 13.4% for residential homes, contributing to the tight supply. Meanwhile, townhouse/condo homes saw a significant 53.2% increase in inventory, which may open up opportunities for buyers looking for properties in this sector.
• Pricing Shifts: The median sales price for residential homes continued its upward trajectory, rising 7% to $311,000. On the other hand, townhouse/condo prices remained flat at $225,000, which may appeal to buyers seeking more budget-friendly options.
• Days on Market: Homes are lingering longer on the market, with residential homes seeing an 8.7% increase in days on market and townhouse/condo homes jumping 50%. This trend may suggest buyers are being more cautious amid fluctuating interest rates and market conditions.
• Months of Supply: The months of supply for residential homes decreased by 10%, further tightening the market for single-family homes. However, townhouse/condo homes saw a substantial 60% increase in supply, indicating a shift in market dynamics where condos and townhomes are becoming more available.

Broader National Trends

In addition to local market changes, the August 2024 update highlights broader national trends. National housing inventory edged up 0.8% from the previous month, reaching 1.33 million units. This reflects a four-month supply at the current sales pace, but supply remains tight compared to demand. Interestingly, the inventory has risen nearly 20% compared to this time last year, but with demand continuing to outstrip supply, price pressures remain high.

The nationwide median existing-home price increased 4.2% year-over-year, reaching $422,600. This marks the 13th consecutive month of annual price increases, driven by a continued imbalance between supply and demand.

What Does This Mean for Buyers and Sellers in August 2024?

For buyers, the August 2024 market offers a mixed bag. While the rise in inventory for townhouse/condo homes may create more opportunities, residential homes remain in tight supply, pushing prices higher. Buyers should be prepared for competitive conditions and be ready to act quickly when a good opportunity arises.

For sellers, rising home prices, especially in the residential sector, present a favorable environment for maximizing returns. However, sellers in the townhouse/condo segment may face more competition and need to be strategic about pricing or offering incentives to attract buyers in an increasingly competitive market.

As the housing market continues to evolve, staying informed is crucial. Check out the full August 2024 housing report on stlrealtors.com/pages/housingreport to track the latest market trends and insights. Whether you're buying or selling, understanding these key dynamics can help guide your next move.