While low inventory continues to curb home sales, April may have seen the first signs that the supply situation is turning around, RE/MAX says in its latest National Housing Report.

According to RE/MAX’s data, taken from a survey of multiple listings service (MLS) data from 52 U.S. metro areas, the months’ supply of homes for sale at the April’s sales pace was 3.6 months—the lowest supply since the National Housing Report began in August 2008. (RE/MAX considers a balanced supply to be 6 months).

However, the company observed a monthly increase in April in the overall number of homes for sale—the first since June 2010. In addition, the year-over-year percentage drop in inventory was 26.6 percent, the lowest annual drop in the last 12 months, perhaps marking a turning point for housing supply.

“Low inventories contribute to a limited growth in sales, preventing some buyers from closing on the home of their choice. But if inventories can rise to a more balanced level, the recovery should strengthen and experience even more home sales,” RE/MAX said in its report.

At the same time, closed transactions and prices continued to rise on both a monthly and yearly basis. April’s report shows an 8.1 percent increase in closed transactions over March and a 10.5 percent increase over April 2012. Agents reporting to RE/MAX are noting increased traffic and say they expect the summer selling season to be even stronger than last year’s.

Of the 52 areas surveyed in April, 41 reported higher sales volume than April 2012, and 25 reported double-digit gains, including Honolulu, Hawaii (53.2 percent); Burlington, Vermont (40.3 percent); Albuquerque, New Mexico (40.2 percent); Charlotte, North Carolina (39.4 percent); and Raleigh and Durham, North Carolina (38.1 percent).

Meanwhile, the median price for all homes sold in April was $177,200, a 4.7 percent monthly increase and a 10.7 percent yearly rise. April marks the 15th month in which the national median price has increased on an annual basis.

Of the 52 areas surveyed, only four posted year-over-year declines in median price: Los Angeles, California (-9.1 percent); Albuquerque, New Mexico (-6.3 percent); Cleveland, Ohio (-1.8 percent); and Providence, Rhode Island (-0.3 percent). Out of the remaining 42 metros, 21 reported double-digit price gains.

“April was exactly what we needed at this time in the housing recovery. Home sales and prices continued to rise, while we started to see improvement in the number of homes for sale,” said Margaret Kelly, CEO of RE/MAX. “It may take a few months, but as prices rise and more homeowners gain positive equity, we should see an increase in the inventory of homes for sale, resulting in a much better selection for potential homebuyers.”

The average days on market for all homes sold in April was 77, eight days fewer than March and 19 days fewer than April 2012, RE/MAX reported.

As interest rates stay low, housing affordability across the country remained strong in the first quarter but showed signs of weakening, according to data from the National Association of Home Builders (NAHB)/ Wells Fargo Housing Opportunity Index (HOI).

According to the index, 73.7 percent of new and existing-homes sold in the first quarter of this year were affordable to families earning the U.S. median income of $64,400. In the fourth quarter of last year, 74.9 percent of homes were considered to be affordable to median-income earners. A year ago, affordability was even stronger, at 77.5 percent.

Despite the decrease, NAHB Chairman Rick Judson noted the HOI has still stayed high over the past four years.

“The HOI has not slipped below 70 since the end of 2008,” he explained. “That said, from a builder’s perspective, it

should be noted that rising costs for building materials, lots and labor are making it somewhat more expensive to construct new homes in today’s market.”

Among the largest metros, or areas with a population of 500,000 or more, Ogden-Clearfield in Utah ranked as the most affordable metro for the third straight quarter. In Ogden-Clearfield, 93.7 percent of homes are affordable to median-income earners, according to the index.

Other large metros in the top five were Indianapolis (92.7 percent); Lakeland, Florida (92.1 percent); Youngtown, Ohio (91.9 percent); and Syracuse, New York (91.6 percent).

San Francisco-San Mateo-Redwood City kept its place as the least affordable large metro, where only 28.9 percent of median-income earners could afford a home. New York-White Plains-Wayne, New York-New Jersey followed closely behind at 29.7 percent.

Filling out the next three spots were three California metros: Santa Ana (35.8 percent), Los Angeles (39.9 percent), and San Jose (43.3 percent).

Among smaller metros, Mansfield, Ohio ranked as the most affordable metro, while another California metro, Santa Cruz-Watsonville, was the least affordable.

“The bottom line is that, for consumers who can qualify for a mortgage at today’s attractive rates, the majority of homes being sold remain within their grasp in markets nationwide,” added David Crowe, NAHB’s chief economist.

The available supply of foreclosures and short sales previously stunted the recovery for new home sales, according to CoreLogic’s May MarketPulse report.

Though, now that the supply of distressed homes and existing-homes for sale has fallen, there’s more room for the new home sales market to expand.

According to CoreLogic, the number of seriously delinquent mortgages (90-plus delinquencies, including foreclosures and REOs), peaked at 3.7 million in January 2010, but has fallen by 1.2 million, or by 33 percent.

As delinquencies decline, new home sales are rebounding after hitting low points over recent years. Citing data from the Census Bureau, CoreLogic reported new home sales have increased 19 percent from a year ago in March.

Improvements in the new home sales market also benefits the economy in several ways since new homes require the acquisition and development of new land, the purchase of supplies, and the need for labor.

According to the report, every new home requires five full-time jobs for 12 months.

Most new home sales are also concentrated in hard-hit suburban metro areas, which bring an economic stimulus to areas devastated by the housing recession.

After observing year-over-year growth in new home sales growth for March, CoreLogic found a concentration of growth in the West. The data provider revealed six of the top 10 markets are located West, and the top three-Oakland, Bakersfield, and San Francisco—are in California.

Oakland and Bakersfield, in particular, have experienced a significant decrease in the supply of distressed homes for sale over the last year, with REO sales in March of this year dropping to about one-third the level seen last year, Corelogic reported.

The decline in distressed sales is not the only factor driving growth in new home sales. According to CoreLogic, San Francisco and Salt Lake City, which ranked No. 4 for its increase in new home sales, both experienced a rebound in new home sales due to economic improvements.

Over the last year in March, both markets have seen their employment bases grow by at least 3.5 percent, which is more than twice the national rate, CoreLogic stated.

Over the last few years, new words have become part of our real estate vocabulary when discussing distressed properties. Terms such as ‘shadow inventory’, ‘cure rate’ and ‘short sales’ were introduced. Other words like ‘underwater’ and ‘upside down’ took on totally new meanings.

Today, we want to add two additional words that we will be hearing often over the next year or so: ‘zombie foreclosures’ and ‘boomerang buyers’.

Zombie Foreclosures

Bankforeclosuresales.com explains the term on their website:

“A zombie foreclosure or zombie home is a property that the homeowner has abandoned and assumed the home has become the property of the lender. Essentially what happens is the homeowner leaves the property after receiving a notice of sale from the lender, and then the home is left empty until the bank acquires the property. This acquisition can take longer than desired and during the period in which the home is not yet owned by the bank, technically the homeowner is still responsible for the property.

Sometimes the homeowner thought the property was foreclosed upon and therefore became the property of the bank. However, they occasionally find out (often years later and without notification) that the bank never took possession of the property and instead the homeowner (who thought they were no longer attached to the home) is notified that they are still responsible for the property legally.”

This situation is occurring in many markets right. The impact of the resolution of this situation is still to be determined.

Boomerang Buyers

In a article late last year, the Wall Street Journal coined the term ‘boomerang buyer’ to categorize a segment of the home buying population who have lost homes to foreclosure or short sales or have gone through a bankruptcy and are again eligible for a new mortgage. There are hundreds of thousands of buyers in this category currently in the market.

Both ‘zombie foreclosures’ and ‘boomerang buyers’ will be part of many real estate conversations moving forward.