Housing market hits highest inventory since 2019 as sellers flood the market

The housing market is finally giving buyers some wiggle room.

After two years of rising prices and shrinking inventory, the number of homes on the market just hit its highest level since 2019, sparking hope for frustrated buyers across the country.

In October alone, available homes rose 29.2% from last year, marking a full year of growth in listings, according to an analysis by Realtor.com.

Homeowners across the country are putting up “For Sale” signs in droves, especially in former pandemic hotspots like Austin, Memphis and Orlando.

These boomtowns are coming back in a big way, with Austin inventory jumping 40.1%, while Memphis and Orlando posted gains of 39.2% and 26.6%, respectively.

And this increase in inventory is not limited to the South; it’s happening in all regions of the US, with the West close behind, with a 33.6% increase, followed by the Midwest and Northeast.

“Sellers continued to increase their activity this October… Total active listings rose to highs not seen since before the pandemic,” Realtor.com senior economist Ralph McLaughlin said in the report.

He adds that a drop in mortgage rates in August may have put homeowners on the fence, leading to even more listings hitting the market.

The number of new listings has also increased.

The West is seeing a 7.0% increase in newly listed homes compared to last October. Markets like Baltimore, DC and Seattle are leading the pack, with newly listed homes increasing by 24.9%, 19.4% and 17.5% respectively.

But despite this rush of new inventory, home prices have remained steady, with the national median price standing at $424,950 — unchanged from last October.

According to McLaughlin, “when accounting for a shift in inventory mix toward smaller homes, the typical home listed this year has increased in asking price compared to last year.”

And while the sticker price may look stable, the price per square foot is anything but, rising 2.1% year over year and 50.5% since 2019.

A silver lining, however, is that more choice means less pressure to rush a decision.

Homes stayed on the market for an average of 58 days, a full week longer than last year and the slowest pace since 2019.

“This marks the slowest October since 2019, marking the seventh consecutive month in which homes spent more time on the market than a year ago,” says McLaughlin.

For those who think they can wait out the competition, here’s a caveat: increasing listings will also create more buyers. Many sellers are also in the market for a new location, so while buyers may have more options, they may soon face more competition.

As McLaughlin predicts, “We now expect home purchase activity to begin rising higher on a year-over-year basis during November and December, both due to declining rates and a 2023 benchmark low “.