For prospective homebuyers who have been struggling with record-high prices and low inventory, there is finally light at the end of the tunnel: 465,000 new listings entered the market in September, an 8 percent increase over this time last year and the largest year-over-year growth seen since 2013, according to Realtor.com’s monthly housing report released on Wednesday.
What’s more, the new listings were on average new 8 percent cheaper ($25,000) than existing inventory in the market, driven by new condos and townhomes (that category was up 3 percent over last year).
However, with more sales than new listings, total inventory on the market still fell from this time last year. The decline was only 0.2 percent — essentially flat year-over-year — and Realtor.com expects that it will increase soon.
“After years of record-breaking inventory declines, September’s almost flat inventory signals a big change in the real estate market,” said Danielle Hale, chief economist for realtor.com, in a statement.
Over the last six years, nationwide inventory crisis has become one of the biggest worries in the industry. As more and more people competed for too-few homes, housing shortages caused major bidding wars and even a drop in home sales..
Signs of increasing inventory have already started to show up earlier this year — but mostly for high-end homes in luxury markets. The Realtor.com findings point toward a more widespread growth of new houses on the market in the months and years to come.
“Would-be buyers who had been waiting for a bigger selection of homes for sale may finally see more listings materialize,” Hale said. “But don’t expect the level to drop dramatically.”
Homes still sell 4 days faster than they did at this time last year (an average house currently spends 65 days on the market).
Indeed, competition is still fierce and it will take time for homebuyers — especially first-time buyers looking for less expensive homes — to start to see more options on the market. But a turnaround is definitely on its way, if not here — in overvalued markets such as San Diego, San Francisco and Seattle, the number of new listings jumped by more than 30 percent.
“Plenty of buyers in the market are scooping up homes as soon as they’re listed, which will keep national increases relatively small for the time being,” Hale said.