This Metric Tells Me Higher Home Prices Are Coming Soon

Here is some year to date data. Even with an increase in supply demand is rising as measured by under contracts.

• New
  listings have totaled 54,530 this year, an increase of 4.7% over a year ago and
  the highest number of new listings in the last 5 years.
• Under
  contracts have totaled 44,981 this year, an increase of 6% from last year and
  the highest level in the last 5 years.
• Solds have totaled 41,391 this year, an increase of 2.1% from
  last year. Sales this year are at the 2^nd highest level over
  the last 5 years.
• The
  average sold price year to date is $479,438, an increase of 2.9% from last
  September.
• The
  median sales price year to date is $416k, an increase of 2.2% from last
  September.

I have started tracking this number, New Listings divided by
Under Contracts as a percentage at a monthly level since 2017. In much of 2015
and 2016 this percentage was negative as the number of under contracts exceeded
new listings and thus home prices soared, but this began changing in 2017.

• In 2017 through September this ratio was 116.3%, meaning that new listings were 16.3% above under contracts.
• In 2018 through September this ratio was 121.4%, meaning that new listings were 21.4% above under contracts.
• In 2019 through September this ratio was 115.1%, meaning that new listings were 15.1% above under contracts. Notice this percentage is lower than 2017. And this percentage has been substantially less for 4 months in a row when compared to both 2017 and 2018. To find out what this means read my article tomorrow.