U.S. home sales in January saw the highest year-over-year gains in the decade since the Great Recession, according to a report from international real estate company RE/MAX.
“We can continue to feel bullish about housing," RE/MAX CFO Karri Callahan told Cheddar. "With low interest rates, strong job numbers, and the millennials really coming into the home-buying experience ... we feel there are a lot of macro-dynamics that put housing in a strong foundation for the future.”
To meet the demand, RE/MAX increased its total number of real estate agents to 5.3 percent to 130,889 agents in 110 countries.
The monthly report found that home sales increased an average of 10.5 percent, an 11-year high, in 54 metros across the country. Three metros led the pack: Los Angeles (32 percent increase), Burlington, Vermont (29 percent), and New Orleans (23 percent).
The market did take its toll on supply, as housing inventory dropped 15.6 percent year-over-year, the biggest decline since 2017.
This has led to price increases as well. The median sales price for the month was $256,000, nearly 10 percent higher than the year before.
"Affordability and limited supply are still constraints, but overall, housing is in a much better place than it was a year ago," said Adam Contos, CEO of RE/MAX, in a statement.
Construction, meanwhile, has picked up the pace to close the gap. U.S. Census data show that the number of building permits issued in January increased 18 percent over the prior year. Housing starts increased 21 percent over the prior year, and housing completions increased by 1.5 percent.
RE/MAX, for its part, had a tougher start to 2020 than the housing market. The company's stock today dropped more than 15 percent during intraday trading after the release of its fourth-quarter financials, which fell slightly below analysts' expectations.
Callahan chalked up the backlash to "some noise in our profit outlook for 2020" that she said was caused by a string of acquisitions, including the purchase of the booj Platform in 2018. The digital products company shed its legacy business faster than expected, she added.
The company also acquired the real estate tech startup First in the last quarter of 2019, an addition that RE/MAX said will help agents become more productive.
"We have invested significantly over the last couple of years for sustainable, profitable, and long-term growth," said Callahan.