SEATTLE–(BUSINESS WIRE)–(NASDAQ:RDFN) — The share of U.S. homes listed for 30 or more days without entering into a contract rose 12.5% in July from a year earlier, according to a new report from Redfin (redfin .com), the technology-driven real estate brokerage. In other words, 61.2% of homes for sale had been on the market for at least 30 days, compared to 54.4% a year earlier.
It is the first year-on-year increase in the supply of “rundown” housing since the start of the pandemic and close to the largest increase on Redfin’s records, which date back to 2012. The only The time it grew the most (13.9% YoY) was in April 2020, when the housing market almost came to a standstill. For this report, “stale” refers to homes that were on the market for at least 30 days without going through a contract, according to data from Redfin.
The fact that homes are staying on the market longer reflects the slowdown in the housing market in response to mortgage rates above 5% and a faltering economy. Rates rose rapidly in the first half of 2022, reaching 5.8% in June before falling slightly to 5.4% on average in July. It took several months for buyers to pull back and sellers to rush to list their homes before the market cooled further leading to a buildup in inventory.
Rising stale inventory is one reason the supply crunch is easing: The total number of homes for sale in the U.S. rose 4% year-over-year in July, the biggest increase since mid-2019. This is largely due to homes staying on the market longer; the number of new registrations decreased by 6%.
“People want to know if we’ve officially moved from a seller’s market to a buyer’s market. Although there is no clear line separating these two ideas, homes that stay on the market longer are a point in favor of buyers,” said Redfin deputy chief economist Taylor Marr. “Buyers can take their time making prudent decisions about homes without worrying so much about bidding wars, bids above asking price and waiving contingencies. It’s a different story for sellers, who have spent the past two years hearing about homes from neighbors receiving multiple offers on their day of sale. Now they have to lower the price and go back to the basics of selling a home, like staging and improving the paint, to get buyers’ attention. »
A look at homes remaining on the market for more than two weeks and more than two months also illustrates the slowdown in the market. The share of homes for sale listed for two weeks or more rose 7.6% year-over-year in July (from 74.6% to 80.3%), the second increase since the start of the pandemic (the first was a 0.1% rise the previous month) and the largest on record. And the share of homes for sale on the market for 60 days or more rose 6.8% (31.4% to 33.5%), the first increase since the start of the pandemic.
Although homes are staying listed longer than they were during the height of the pandemic homebuying frenzy, the time on market is still historically low. The typical house stayed on the market longer in 2018 and 2019 than today, for example.
The sharp year-over-year increase in stale inventory is expected to level off soon, as it partly reflects last year’s hot housing market, when homes sold very quickly. The typical home was under contract in 15 days in July 2021 – near the fastest record – prices hit an all-time high and the total number of homes for sale fell to an all-time low, due to mortgage rates below 3%.
The share of housing supply that was stale was stable before the pandemic, with fluctuations largely due to typical seasonal patterns.
Expired inventory increased the most in Oakland, Calif.
The share of homes for sale in Oakland, Calif., that have been on the market for at least 30 days rose 60.7% year-over-year in July, the largest increase of the 50 largest US metropolises. populated. It is followed by Phoenix, where the share of stale inventory rose 54.5% year over year. This is followed by Austin (50.9%) and two Southern California metros: Anaheim (49.7%) and Riverside (46.7%). Fort Worth (43.4%), Dallas (42.9%), Washington, DC (42.5%), Sacramento 41.7%) and Seattle (41.3%) round out the top 10.
More than half of those places — Oakland, Phoenix, Austin, Anaheim, Riverside, Sacramento and Seattle — are among the 20 fastest-cooling housing markets in the first half of 2022.
“The market took a 180 degree turn from early spring to late spring as buyers retreated due to high mortgage rates. Many sellers tell me they feel like they’ve missed out on the hot market,” said Christopher Johns, a Redfin agent in Houston, where the share of stale inventory rose 10.2% year-on-year. the other in July. “I remind potential sellers that we are not in a real estate crash; it is a corrigendum. If sellers list their home at a slightly lower price than it would have five months ago, they are still likely to get a strong offer. And my advice to buyers is to remember that 5% rates are not the end of the world; they can always refinance in the future if rates go down.
The share of stale inventory fell in just one city: Fort Lauderdale, Fla., where it fell about 1% year-over-year in July.
To read the full report, including a metro-level graph and table, please visit: https://www.redfin.com/news/homes-stale-housing-inventory-july-2022
Redfin (www.redfin.com) is a technology-driven real estate company. We help people find a home with brokerage, instant home buying (iBuying), rental, loan, title insurance, and home improvement services. We sell houses for more money and charge half the fees. We also run the #1 real estate brokerage site in the country. Our homebuyer clients see homes first with on-demand viewings, and our loan and title services help them close quickly. Customers selling a home can receive an instant cash offer from Redfin or have our renovation team repair their home to sell for the best price. Our rental business helps millions of people across the country find apartments and houses to rent. Since launching in 2006, we’ve saved our clients over $1 billion in commissions. We serve over 100 markets in the United States and Canada and employ over 6,000 people.
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