There's a mad rush for housing like we haven't seen since the end of the financial crisis
To recap the problem, the supply of housing, especially in the affordable entry-level segment, is not keeping up with huge demand from first-time buyers and existing homeowners looking to upgrade.
Zillow's latest Real Estate Market Report released on Friday shows that homes are selling faster than they have at any time since 2010.
In June, the median number of days a home stayed on the market was down to 78 - eight fewer than the same time last year.
"If you're looking for a home, be prepared to move quickly," said Svenja Gudell in a release on Friday.
She noted the vicious cycle where even though rising home prices are attractive to sellers, homeowners looking to list do not put their houses on the market. They're concerned that they won't quickly find a new, affordable one or would have to enter a stressful bidding war in the buying process.
And so, inventory remains limited.
"Until the supply increases, it will remain a tough market to find a home," Gudell said.
The markets with the biggest year-on-year change in time on the market in June included Philadelphia, Pittsburgh, and Charlotte, where the average period shrank by at least two weeks.
At the same time, there were 4.7% fewer homes for sale compared to a year ago. Combined with the high demand, this helped push Zillow's Home Value Index up by 5.4% year-on-year to $187,000.Listed on Thursday, deadline on Monday
Redfin, another brokerage firm, said that in June 2016, the housing market was at its fastest and most competitive since 2009.
Redfin on Thursday said the typical home went under contract in 41 days in June, the briefest period since they started counting in 2009.
"Homes are listed on Thursday, with a deadline for offers on Monday," said Michelle Ackerman, a Redfin agent in Denver, which the firm identified as the nation's hottest market. "Many homes are technically under contract by Monday but that status is often not reflected in the MLS [a listing portal for brokers] until Tuesday."
Redfin's chief economist, Nela Richardson, noted that the solution to this inventory crunch rests on how many willing sellers there are. Buyers are plenty, thanks to low mortgage rates and a healthy job market.
"In an environment where one may have only a few days to decide to make an offer on a home, it's critical that buyers and sellers enter the market prepared and with clear eyes, and to resist the temptation to settle for a home that may not suit their needs in the interest of just buying a place," Zillow's Gudell advised.