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Home prices are creeping back up near where they were this time last year, and it’s about more than a drop in housing demand.
The number of new listings coming onto the market has plummeted 27 percent since June of last year — the greatest annual drop in any month since the start of the pandemic, according to the latest housing market report from Redfin. And while buyers have been withdrawing from the market as well, the number of pending home sales has declined by a comparatively moderate 15 percent.
This has resulted in a housing market where inventory remains constrained. The total number of homes for sale at any given time is 11 percent lower today than it was this time last year, Redfin found. And it’s begun to arrest the home-price declines from late last year nationwide.
The median U.S. home-sale price was $383,000 in June, down only 0.9 percent year over year, according to Redfin. That’s the lowest annual price decline in nearly four months.
“Buyers should keep in mind that desirable homes are getting multiple offers and selling above asking price,” Redfin Premier agent Andrea Chopp, who is based in the Oakland area, said in the report. “And sellers should know that their home may not attract as much competition as their neighbor’s home did two years ago, but it will sell if they price it fairly and put effort into marketing.”
Redfin also found signs that buyer interest is beginning to return. The company reports that interest from buyers in its home tours and agent services in recent weeks reached its second-highest level since May 2022. Buyer interest in these services was up 10 percent from a year ago.
But the dearth of new listings continues to be the constraint holding back the home-transaction market. And in some parts of the country, the number of willing new sellers over the past year has been nearly slashed in half.
New listings were down in every metro that Redfin analyzed. But most severe were the declines in Las Vegas and Phoenix, where new listings careened downward more than 43 percent since this time last year.
The drop in newly listed homes for sale was stark in cities across the West Coast, with Seattle and the California metros of Oakland and Riverside all seeing at least 37 percent fewer new listings than they did a year ago.
And across the country, the vast majority of metros remained mired in a deep seller’s market — where buyers find themselves in competition for few listings.
The number of months supply was 2.6 nationwide in June. That’s significantly below the 4 to 6 months of supply typically considered to signal a balanced dynamic between buyers and sellers. A supply of homes higher than 6 months is typically thought to favor buyers.
