June saw a small increase in Ada County closings and an 18% increase in pending contracts compared to the pendings at the end of June, 2019. This increase in new contracts was acheived despite a 40% drop in inventory over the last year. The demand-to-supply ratio is higher than ever! Resale inventory has dropped over 50% since June, 2019, and new home inventory has increased 23%.
Despite the increase in new home inventory, as builders rush to answer the need for homes, there are only 26 days of new homes ready for occupancy. Owners of residential property in Ada County are reluctant to put their homes on the market for want of replacement property during a period of low inventory. As a result, there is only a 21 day supply of resale homes.
Despite the Coronavirus effect on demand, average prices over the last year have increased 10.2%. Unless inventory can increase, which will probably mean new home construction must pick up dramatically, we expect prices to rise more rapidly in the future as people in congested living areas look for more spacious and safer environments.
The chart below shows the number of new contracts at the end of each month over the past year.