Dive Brief:
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August and September bring the greatest number of home listings and discounts, according to a new analysis by Zillow, which noted that sellers typically reduce their prices heading into fall.
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While for-sale inventory is currently 5.3% lower than it was a year ago, Los Angeles saw around 8,000 more homes listed in August 2016 than in April of that year, while Seattle saw nearly 5,000 more listings for the same period.
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Homes sold in August 2016 showed more frequent price cuts, with 15% of listings for the month having their prices reduced. Markets including Philadelphia, Detroit and San Antonio, TX, had markdowns of 19%, 20.8% and 20%, respectively, for the month.
Dive Insight:
With the average builder taking six months to build a single-family home, a jump in starts for the category in early 2017 points to an increase in listings for buyers hoping to take advantage of better purchasing conditions in late summer. January saw a 1.9% rise in single-family starts from December while February notched a 6.5% surge from January, suggesting August and September will likely give way to more listings on the market.
Starts in the category, however, took a turn in March following strong demand and a mild winter that fueled an early start to this year's spring selling season. Though the month saw a 6.2% drop in single-family home starts, the month experienced a boost in building permit authorizations — an indicator of future construction activity — and the highest number of single-family homes under construction since September 2008, which could support buying activity in the late summer months.
Still, the persistent lot and labor shortage, along with higher material prices, continue to be a drag on construction activity that would add much-needed inventory to the market.
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