US home sales drop as inventory grows in February: report

Marks 7th consecutive month of declines as market keeps slowing

Home sales declined in February (Credit: iStock)
Home sales declined in February (Credit: iStock)

Is it a buyer’s market yet?

Home sales declined in February as inventory grew in the U.S., according to a new report from Re/Max.

The 4.2 percent drop last month marked the seventh consecutive month of year-over-year declines. Inventory, meanwhile, grew 5.8 percent in February, the fifth consecutive month. Re/Max’s monthly survey covers 54 metro areas across the country.

“Trends of five months or more often indicate significant shifts, Re/Max CEO Adam Contos said in a release. “Year-over-year trends in declining sales and rising inventory have both reached that length now.”

Inventory in terms of months of supply grew as well, up to 3.4 months in February from 3.1 months in 2018.

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Miami was among the five markets with more than six months of supply, at 7.6 months. A healthy market typically has six months of supply. Denver and San Francisco reported the fewest months of supply, with 1.4 and 1.6 months, respectively.

Homes spent roughly the same number of days on the market last month — 63 — according to the report. The cities with the fewest days on market were Omaha, Nebraska, at 34 and San Francisco at 37. Augusta, Maine, and Trenton, New Jersey, averaged 120 days and 113 days on the market before selling.

The median home sales price actually increased to $240,000, up 5.5 percent year over year. It rose in January as well. In February, the median sales price rose in Boise, Idaho, Cincinnati and Wilmington/Dover, Delaware, and it fell in markets that include Birmingham, Alabama, Hartford, Connecticut and Anchorage, Alaska.

The next few months will determine whether the shift in inventory and sales brings in a new wave of buyers, Contos said.

There have been other signs of an overall slowdown of the housing market.

A report released in December found that home flipping in the U.S. was down to its lowest levels in more than three years. The U.S. Commerce Department also reported that new home sales dropped 8.9 percent in October compared to September, marking an almost two-and-a-half-year low.