U.S. home-sale prices edged up again in May, growing 3.6% from a year ago to a median of $315,700, according to a new report from Redfin. This was the biggest annual home price increase in seven months.

Only six of the 85 largest metro areas Redfin tracks saw a year-over-year decline in their median sale price, the biggest of which were a 6% drop in San Jose, a 2.5% dip in New York, and a 2.2% decline in Honolulu. All three of the other metros that saw price drops were in California: Orange County (-1.4%), Los Angeles (-0.8%) and Oakland(-0.7%).

"As mortgage rates have fallen this month, Redfin has seen upticks in the number of people wanting to talk with our agents about buying homes and the number going on home tours," said Redfin chief economist Daryl Fairweather. "Recent surges in mortgage applications also reflect the impact low rates are having on home buyer demand nationwide. We haven't yet seen a commensurate increase in U.S. home sales, and I don't expect sales to increase substantially in the long run. That's because there still aren't enough homes for sale for all of the people who want to buy homes. In May, inventory posted its smallest increase in eight months, and fewer new listings came on the market than last year. Low rates and rising prices will likely lure sellers onto the market this summer, but the lack of new construction will continue to hold back sales growth."

Market Summary May 2019 Month-Over-Month Year-Over-Year

Median sale price $315,700 3.0% 3.6%

Homes sold 314,300 14.1% 0.2%

New listings 418,900 5.1% -0.7%

All Homes for sale 890,300 5.1% 2.5%

Median days on market 36 -4 -1

Months of supply 2.8 -0.3 0

Sold above list 24.4% 2.1% -3.6%

Median Off-Market Redfin Estimate $304,600 1.6% 4.9%

Average Sale-to-list 98.4% 0.1% 0.0%

Home sales were essentially flat in May, up 0.2% year over year. 48 of the 85 metros tracked by Redfin saw an increase in sales from a year earlier.

The number of homes for sale as of the end of May was up 2.5% from the same time last year. This was the smallest year-over-year increase in home supply in eight months. The number of homes newly listed for sale last month fell 0.7% from a year earlier.

Nationwide, measures of competition are mixed, with some pointing toward a hotter market than a year ago and others indicating that the market has cooled. One indicator of a hotter market is the median number of days on market, which dropped to 36 days in May from 37 days a year earlier. This is the lowest days on market measured in any month of May since at least 2010 (as far back as Redfin has recorded this measure nationally).

An indicator pointing to a cooler market is the share of homes for sale that had a price drop, which rose to 25.9%, the highest rate since September's record high, and up from 23.4% last year. The share of homes sold above list price is also falling, down to 24.4% in May from 28% last year. Still, last month's rate of homes selling above list price was the highest since last August.