About the only negative is that there were just 130 new homes sold in July accounting for 7.6% of total sales and total new home construction sales are 945 for the year to date or 14.8% of total sales. This compares to the peak of new home construction way back in 2002 when new home sales accounted for 30.5% of the 1,121 homes sold in July and were 33% of the total home sales for the year to date. It is pure speculation to think about where the market would be if we had one thousand more new homes to sell but with the low inventory and high demand it is certainly possible that this rate of construction could be absorbed without too much difficulty.

There are currently 4,002 active listings but 1,525 are under contract and 464 are shown as new homes under construction or to be built. This leaves a net of 2,013 active listings and with a demand of around 900 homes per month we are left with a slim two month supply compared to a normal market which is a six to seven month supply. This is evident in the ‘days to offer’ which for resale homes is at 48 days for the year to date. This is the lowest figure on record and compares to an average over the last few years of 81 days and the previous low, again way back to 2002, when homes were on the market an average of 56 days prior to going under contract.

We expect the higher prices will bring more resale homes to the market and builders are certainly trying to ramp up construction which will provide more new homes in the coming months. Couple this with the recent increase in mortgage rates and the fact that demand slows as school starts and we should expect a better balance between supply and demand over the next few months.