US active listing inventory grew 30.7% year over year, faster than ever before in historical Realtor.com data. However, the slowdown in the number of new listings – it has actually fallen – has left the housing market struggling to find a balance, according to its chief economist Danielle Hale.
Inventory increased significantly in June and May, but the July data suggests “some potential sellers are wondering what recent market changes mean for their listing plans.” But the data indicates that homeowners struggling with the decision are still in a good position in many markets, with buyer interest allowing well-priced homes to sell quickly.
Hale said that since many sellers have a substantial cushion of equity to tap into, thanks to the last decade of rising prices, whether they take advantage of these opportunities will be key to moving stocks forward.
Maybe until 2023 to “return to normal”
Bill McBride of the Calculated Risk blog said his current outlook for house prices assumes stocks will continue to rise in the fall.
“I expected inventory to return to 2019 levels in early 2023 with weak demand and normal levels of new listings,” McBride wrote Monday. “However, it may take much longer to return to more normal inventory levels – inventory will tell the tale”
The heat may have caused big drops in the Northeast and Midwest
Realtor.com said nationally, newly listed homes were down 2.8% from July 2021, with the biggest declines in the Northeast (-14.3%) and the Midwest (-11.0%). He also suggested that the record-breaking heat in July for much of the country may have played a role in the drop in new registrations.
The typical home spent 35 days on the market in July, down two days year-over-year and 26 days from the 2017-19 average, according to the realtor’s report.