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Inventories continued to fall to record lows in November and the age of the nation's listings inventory declined, but asking prices failed to rise as housing markets prepared for their annual wintertime hibernation.

List Prices Flatten Despite Sinking Inventory

Inventories continued to fall in November to record lows and the age of the nation’s listings inventory declined, but asking prices failed to rise as housing markets prepared for their annual wintertime hibernation. The total U.S. for-sale inventory of single family homes, condos, townhomes and co-ops dropped to its lowest point since 2007, with 1.674 million units for sale in November, down 16.87 percent compared to a year ago and more than 45 percent below its peak of 3.1 million units in September 2007, when Realtor.com began monitoring these markets. The median age of the inventory was also down by 11.4 percent on a year-over-year basis. The national for-sale inventory in November (1,674,412) decreased (4.69 percent) from what it was in October and was down by 16.87 percent on an annual basis. The large year-over-year decline in inventory is a positive sign that the market may have worked through much of its excess inventory, which should help to bolster housing prices and potentially set the stage for additional growth. The median age of inventory of for-sale listings was 101 days in November, up by 4.12 percent from October, but 11.40 percent below the median age a year ago (November 2011). While the median age of the inventory is highly seasonal, the year-over-year decline is consistent with other data that shows a general tightening of market conditions throughout the year. However, the median list price in November ($189,900) was the same as it was a year ago despite the significant gains observed earlier in the year. The nationwide median list price ($189,900) held steady in November and is essentially unchanged from a year ago. While the gains that accompanied the onset of the 2012 spring home buying season have disappeared at the national level, record-low inventories may prevent a further erosion of list prices in 2013.according to November data from Realtor.com. National data masks pronounced regional differences in the strength of the housing market. Patterns that have been observed throughout the year continued to run their course, as markets that were once the epicenter of the housing crisis continued to strengthen while markets in more industrialized parts of the Midwest and Northeast continued to fall behind. California, Arizona, and Washington markets are ending the year with dramatic declines in their number of for-sale properties, coupled with significant year-over-year list price increases of 10 percent of more. However, markets such as Peoria, Ill.; Fort Wayne, Ind.; and Toledo, Ohio-areas that never experienced a rapid run-up in their housing prices-have experienced median list prices that are down by as much as 10 percent on an annual basis and significantly smaller year-over-year reductions in their for-sale inventories. On a year-over-year basis, the for-sale inventory declined in all but five of the 146 markets covered by Realtor.com, while list prices increased in 70 markets, held steady in 30 markets and declined in 46 markets. The number of markets experiencing year-over-year list price declines has increased steadily in recent months, underscoring the continued fragility of many housing markets.

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