If you're out shopping for a home this weekend, bring your checkbook.
There may still be ice on the ground in much of the nation, but the spring housing market is the hottest it's been in a decade. Consumer sentiment in both the economy and the housing market is rising and that is translating into strong demand from homebuyers. The trouble is, the supply of homes for sale is incredibly weak and getting weaker. What is for sale is selling fast.
The typical home that sold last month went under contract in 60 days, eight days faster than one year ago, according to a new report from Redfin, a real estate brokerage. Nearly 15 percent of all homes listed for sale in February were off the market within two weeks, up from 11.7 percent last year. This is the fastest February market Redfin has recorded since it began tracking in 2010.
The speed and the competition are combining to push home prices higher. Redfin recorded a 7 percent annual jump in median sale prices in February. Homeowners now have a lot of equity. In fact, total home equity hit a new peak at the end of last year, according to research by the Federal Reserve.