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Buyers have more homes to choose from than they’ve had in years. Active listings nationwide rose 6.7% from a year ago, up from last week’s 6.3% gain and the fastest growth since February.
In fact, September inventory now sits just 9.1% below pre-pandemic levels, the smallest gap since the pandemic began, according to Realtor.com’s latest market update.
Here are the other key takeaways:
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Inventory is growing because buyers are sitting out, not because more sellers are listing. New listings actually fell 4.1% year over year, as higher rates kept more homeowners locked into their existing mortgages.
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Mortgage rates hit a near three-year high. Rates climbed to 7.28% as 10-year Treasury yields hovered near multi-decade highs, and they’re now nearly a full point above where they were a year ago.
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Asking prices keep sliding. The median listing price dropped 2.4% from a year ago, its 38th straight week of annual declines, and is down 1.9% year to date.
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Price cuts are the most common they’ve been in nearly four years. About 20.8% of listings had a price reduction in September, the highest share since October 2022.
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Homes are still selling a day faster than last year. Sellers pricing to sell are keeping things moving, though homes are selling faster in the West and slower in the Midwest and Northeast.
MY TAKE
Falling home prices should be good news for buyers, but rates, not prices, are driving this market. Asking prices are down about 2% from last year, yet mortgage rates are nearly a full point higher, erasing those savings and then some. Those higher rates are keeping buyers on the sidelines, homeowners locked in, and inventory growing. What happens next largely depends on where rates go. If they fall, sidelined buyers could return and absorb some of that inventory. If they keep climbing, expect more price cuts and longer waits for sellers.
Until Next Week,
Ken
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