New Real-Estate Math: Half a Million More Sellers Than Buyers
A housing development in Pineville, N.C. Photo: Angela Owens/WSJ
The inventory of homes for sale is finally rising. Buyers aren’t interested.
The U.S. housing market had nearly a half million more sellers than buyers in April, the biggest such gap on record in seasonally adjusted data going back to 2013, according to an analysis by real-estate brokerage Redfin.
After years of frustration with fast-rising prices and bidding wars, buyers now have the upper hand in many parts of the country. More sellers are cutting prices or offering concessions such as paying for buyers’ closing costs.
A historic shortage of homes for sale is a big reason why the housing market has been stuck near its slowest sales pace in three decades. Buyers were frustrated with a lack of options, and desirable homes often sparked bidding wars.
Now, supply is rising because some sellers have experienced life events that require them to move, like a job relocation or having a baby. Others are unloading investment properties because their costs are rising, or they are worried that home prices will fall and want to sell before that happens, real-estate agents say.
The new listings haven’t been enough to jolt the housing market out of its slumber. Existing-home sales in April fell for the second consecutive month, notching the slowest sales pace for any April since 2009.
Many buyers are still priced out. Home prices are up more than 50% in the last five years and mortgage rates are holding above 6.5%. Buyers are also feeling economic uncertainty, which tends to discourage major purchases like a new home.
Home sellers outnumber buyers by nearly 500,000Source: RedfinNote: Seasonally adjusted
2013’15’20’251.21.41.61.82.02.22.42.6millionBuyersSellers
The mismatch between buyers and sellers is a sign that home prices could decline slightly on a national basis later this year, said Chen Zhao, Redfin’s head of economics research.
U.S. home prices rose 1.4% in May from a year earlier, according to Intercontinental Exchange, a slowdown from 2% annual growth in April. Prices fell from the prior May in 24 of the 100 biggest metro areas, mostly across the Sunbelt.
“It doesn’t feel like buyer demand is going to come back that much,” Zhao said. “Prices are just too high.”
Active listings are still about 14% below typical prepandemic levels. But they rose in May to the highest level since 2019, according to Realtor.com, which is operated by News Corp, parent of The Wall Street Journal
Read More/Source The Wall Street Journal. .