FOR IMMEDIATE RELEASE
Nita Martin
601-948-1332 ext. 12 
09/29/16
 
August 2016 Residential Real Estate Market Report 
Suffering Supply Levels Are Stealing the Momentum of the Housing Market  
 
Jackson, MS
(September 29, 2016) - High demand continues to drive home prices upward as competition for affordable turn-key properties stiffens due to low and declining inventory. 
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In August, median sales prices in Hinds, Madison and Rankin counties increased by 2.7 percent to $173,000.  Home prices in Hinds county experienced the largest escalation of 5.2 percent to a median sales price of $124,000 compared to the same period last year.
 
The inventory of homes for sale remains at a modest 7-month supply of 3,174 units - a 1.6 percent decrease year-over year for the tri-county area.  This marks the second consecutive month that inventory has declined in our local market. In a stark comparison to a "pre-housing bubble" market for Central Mississippi MLS, inventory peaked at nearly 6,000 units in a given month. NAR Chief Economist, Lawrence Yun states, "It's very concerning to see that inventory conditions not only show no signs of improving but have actually worsened in recent months from their already suppressed levels a year ago. Without more supply, the U.S. homeownership rate will remain near 50-year lows."  

Regional Data
CMMLS reports that pending sales are down by 4.1 percent year-to-date within its ten-county area. Pending home-sales in the south also declined 3.2 percent in August and are 1.5 percent lower than August 2015. Existing-home sales in the South in August fell 2.7 percent to an annual rate of 2.16 million, but are still 0.9 percent above August 2015. The median price in the South was $209,700, up 6.7 percent from a year ago.
 
National Data
The National Association of REALTORS® reports that single-family home sales declined 2.3 percent to a seasonally adjusted annual rate of 4.70 million in August from 4.81 million in July, but are still 0.6 percent above the 4.67 million pace a year ago. The median existing single-family home price was $242,200 in August, up 5.3 percent from August 2015.

Is New Construction the Answer?
According to Yun, evidence is pointing us in that direction. In the best scenario, housing supply is driven by both new construction and existing homes brought to the market. In the aftermath of the recession and housing crisis, foreclosures and short sales became the primary source of inventory but they've now receded. That being said, we're looking more closely at the supply of new inventory.

Earlier this month, NAR released a new study that revealed single-family home construction is not keeping pace with job creation and is lacking overall in 80 percent of measured metro areas including the Jackson metro area.
 
When combined with the scant supply levels for existing homes, prices are likely to continue to rise hampering affordability. In fact, CMMLS reports that housing affordability dropped 5.8 percent year-over-year in August for the overall ten-county region. The 12-month average shows a 2.1 percent decrease to 165 for the same region.

NAR reports that nationally housing inventory has declined year-over-year for 15 straight months and after increasing 5.1 percent last month, existing-home prices have risen year-over-year for 54 consecutive months.
  
Here's a YTD snapshot of Hinds, Madison & Rankin Counties
County  New
Listings 
Closed Sales  Median Prices  Inventory
Units 
Months Supply 
Hinds  2,161  1,225   $124,700  1,188   8.3  
Madison  1,604 1,102   $237,250  815   6.65
Rankin  1,984   1,414   $169,900  820   5.1  
(all figures are year-to-date) 

For more statistics throughout the Jackson Metro Area and Central Mississippi, view the CMMLS August 2016 Market Heartbeat here.  Read  NAR's August 2016 statistics here. Watch Lawrence Yun's commentary on the August 2016 Housing Market here.   

About Central Mississippi MLS, Inc.
Central Mississippi MLS Inc. and Central Mississippi REALTORS ® are 
"The Voice for Real Estate in Central Mississippi"  and represent the largest real estate association in the state of Mississippi serving more than 1,700 licensed real estate professionals across ten counties of Central Mississippi
(Hinds, Madison, Rankin, Yazoo, Holmes, Attala, Leake, Scott, Simpson and Copiah).  To learn more about CMMLS, visit centralmsrealtors.org or call 601.948.1332.  
 

1 Housing affordability is measured by the percentage of the median household income that is necessary to qualify for the median-priced home under prevailing interest rates. A higher number means greater affordability. An index of 165 means that the median household income was 165% of what was necessary to qualify for the median-priced home under prevailing interest rates.
 
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