Home buyers may soon get at least a little relief. After years of steadily worsening housing shortages, more homes are finally going up for sale.
The number of new listings on realtor.com® in September shot up 8% year over year, according to a recent report from realtor.com. That’s the biggest jump since 2013, when the country was still clawing its way out of the financial crisis. And it gives eager buyers a lot more options to choose from.
“It’s a key inflection point,” says Chief Economist Danielle Hale of realtor.com. “There are still more buyers in the market than homes for sale. But in some [parts of the country], the competition is among sellers to attract buyers.”
That’s a big shift from a year ago, when bidding wars and insane offers over asking price were par for the course. But it doesn’t mean the housing shortage has suddenly dissipated.
Nationally, the total inventory of homes for sale was essentially flat compared with the year before—moving down 0.2%. Hale expects the bump in new listings to buoy that inventory.
And while the median home price, at $295,000, was up 7% in September compared with a year ago, the increase in homes hitting the market helped to slow that rise. The median home price in September 2017 was a 10% increase over the previous year.
The new inventory tended to be a little cheaper, by about $25,000, and about 200 square feet smaller than what was already on the market. That could be due to the 3% rise in condo and town home listings.
The influx of homes on the market is partly due to sellers betting that we’ve reached the peak of the market. So they’re rushing to list their homes and get top dollar while they can. But those owners are learning that their home, particularly if it’s priced high, may no longer sell immediately for that price. And homes need to be staged and in tiptop shape.
The increase in inventory is likely to slow wild price growth as well, although prices aren’t likely to fall anytime soon. It all comes back to supply and demand. Folks will pay a premium for something if there’s not enough of it to go around. So while this is fantastic news for buyers, there are bound to be some disappointed sellers who were hoping to get a little more for their abodes.
Of the 45 largest housing markets, San Jose, CA, in the heart of Silicon Valley, saw the biggest boost in new listings, according to the report. It was followed by Seattle; Jacksonville, FL; San Diego; and San Francisco. That’s a boon to buyers in these ultra expensive markets.
But make no mistake: Prices are still rising, and there aren’t enough homes to go around. Still, the uptick in homes going up for sale “will eventually shift the market from a seller’s market … to a buyer’s market,” says Hale.