Scott Thompson
With home prices and mortgage rates still uncomfortably high, buyers just aren’t biting, leading to a glut of real estate listings gathering dust. For the week ending Feb. 4, home inventory shot up by 70% over levels seen this same week a year earlier.
As a result, many homeowners simply do not want to sell their homes as of late. New listings were down by 11% from one year ago for the week ending Feb. 4.
That marks 31 weeks that fewer sellers have put their homes on the market compared with last year, and for good reason: Sellers might not only struggle to sell, but if they succeed, many might have to face the same steep home prices and mortgage rates as other buyers, making it a lose-lose scenario all round.
“High costs and mortgage rates can significantly up the ante for homeowners hoping to trade up and remain in their current area,” explains Hale. Many are deciding to just stay put.
Plus, this continuing lull in new listings means homebuyers might not be all that excited by the idea of sifting through stale, steeply priced properties.
“With new listings declining, the growing number of homes for sale reflects still-low buyer interest amid high costs,” adds Hale.
In January, homes lingered on the market for 75 days. And for the week ending Feb. 4, listings sat for 19 days longer compared with this time last year. Overall, the housing market is currently experiencing a 28-week trend of homes lingering on the market for longer periods than they did a year earlier.
But this presents a unique opportunity for buyers willing to comb through old listings for bargains.
“January data also reveals a significant increase in the share of homes for sale with a price reduction, more than double compared to the same period last year,” says Hale.