Two new data reports have found housing supply is starting to outpace demand, with a surge of new listings being seesawed by a growing deficit of buyers.
Zillow (NASDAQ:Z, ZG) is reporting new listings of houses rose by nearly 13% from one year ago, while the level was up by 8% from April; the total inventory was up 22% year-over-year. And while the inventory is still 34% below pre-pandemic norms, it is the smallest deficit in more than three years.
However, while the selection of homes for sale has increased, sales are down 6% from one year earlier. And this occurred while nearly one-quarter of all homes for sale received a price cut in May, the highest share in the past six years for this time of year.
“Rate lock’s hold seems to be loosening — homeowners who may have put off listing their homes are done waiting. But just as more choices sprang up for sale, buyers turned on cruise control,” said Orphe Divounguy, Zillow senior economist. “Inflation has hit younger households hardest, and stubbornly high rates have pushed a mortgage out of reach for many first-time buyers. That has cooled competition for houses. If these trends hold, we’re likely to see price growth flatten or tick down over the next year.”
Separately, data from Redfin (NASDAQ: RDFN) determined more than three in five (61.9%) homes that were on the market in May had been listed for at least 30 days without going under contract. This is up from 60% one year earlier and roughly 50% two years earlier.
Redfin also warned that having more homes for sale in a slow demand market will result in a glut of less-desirable listings.
The share of inventory sitting on the market for 30-plus days was most onerous in Dallas, where just over 60% of listings that were on the market in May had been listed for at least 30 days, up from 53% a year earlier. Slow-moving markets are also happening in three Florida metros: Fort Lauderdale (75.5%, up from 68.2%), Tampa (68.7%, up from 61.9%) and Jacksonville (69.2%, up from 62.9%). On the flip side, the percentage of homes sitting on the market for at least 30 days has declined most in Seattle (41.2%, down from 50.5%), Las Vegas (55.9%, down from 63.9%) and San Jose, CA (34.4%, down from 42.2%).
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It’s interesting that the northern Dallas suburb of Plano seems to have the opposite market condition. Houses come for are quickly, put under contract and sold.
Same in Chicago Metro area
This is completely contrary to what I am seeing in my market – which only proves that the 1st rule of real estate is that ALL REAL ESTATE IS LOCAL.
Exactly correct! I wish these kinds of articles were not published. They only add to the confusion of the uninformed consumer.
The National statistics in the news has always been the wrong message to the majority of articles. More often than not reporting West Coast or East Coast information. It’s been a frustration for me my entire 54 year career and I’m in the Chicago Metro area large enough to matter.
Cal Berkeley Economics grad here. Will soon be a GA realtor after working as a California realtor. This article makes perfect sense. Although all real estate is local, people are moving from state to state making real estate stats more national. Californians moving to parts of Texas may not find pricing as favorable now as maybe 2 years ago. Interest rates have doubled from 2021-2022.
There has never been a truer statement. The MLS is too large. Really hurting business for those that know their areas.
When will we see a drop in interest rates?
Do you expect inflation to get better or worse!
Real estate foreclosures are up substantially so the inventory is up so sellers can avoid losing what equity they have left
We all know real estate is local. But this will be true once all areas catch up on inventory. It has to start somewhere. The bottom line is that normal buyers who don’t have an over priced house to sell will have issues qualifying until they drop prices 35%. They better not cut rates even if the media continues to spin lie the economy for election reasons
Again locally the drop won’t be 35% nationally. Reading your comment the public may believe their area will drop 35% and I’m sure that won’t happen here. We only lost value once since WWII that was 2007-2009. There were some flat years but no declines. The Midwest does not skyrocket then fall.
I don’t understand some of these comments… Larger trends are obviously a reflection of the overall numbers, and are not a reflection of any of the outliers whether more pronounced or less pronounced than the trend… In my 43 year career, I have been able to take information from articles like this and rationalize it with my local market… Obviously every market has different motivating factors for their buyers and their sellers… These comments that I see apparently don’t take any of that into consideration… And those making the comments don’t want to do even the slightest bit of “lifting” by rationalizing these trends into their own or local market… Readers… Wake up… Apply the data you get to your own market…