Housing Market Supply is ‘Stale’

Housing Market Update: More Supply, But Stale Listings and Rising Prices

Increased Inventory, But Slow Sales

There’s good news in the housing market to close out 2024: there’s a lot more supply. The bad news: a lot of that supply is stale, sitting unsold for much longer than usual. According to a new report from Redfin, active listings in November were 12.1% higher than they were in November 2023 and hit the highest level since 2020.

Stale Listings on the Rise

More than half of those homes (54.5%), however, had sat on the market for at least 60 days without going under a contract of sale. That is the highest share for any November since 2019 and is up nearly 50% from the year before, according to the report. The typical home that did go under contract did so in 43 days, according to Redfin, the slowest November pace since 2019.

Mortgage Rates and Home Prices

Mortgage rates shot over 7% in October and have mostly stayed there through the end of the year, according to Mortgage News Daily. Home prices also continue to rise. The latest monthly price report from S&P CoreLogic Case-Shiller, released Tuesday, showed prices nationally up 3.6% in October compared with the same month a year earlier.

Pending Home Sales and Interest Rates

Pending home sales, which is a measure of signed contracts to purchase existing homes, rose in November both monthly and annually to the highest level in nearly two years, according to the National Association of Realtors. They were, however, coming off a very slow base. The Realtors claim interest rates are now at a new normal.

Challenges Ahead

The slower selling pace doesn’t bode well for the new year, especially with interest rates remaining elevated. There is still demand, but renters are remaining renters longer, according to another Redfin report, due not only to higher home prices but higher prices for brokers and movers.

Conclusion

The housing market is experiencing a mix of positive and negative trends. While there is more supply, many listings are stale and unsold. Mortgage rates and home prices continue to rise, making it challenging for buyers. As we head into the new year, it will be important to monitor these trends and see how they impact the market.

Frequently Asked Questions

Q: What is the current state of the housing market?
A: The housing market is experiencing a mix of positive and negative trends. There is more supply, but many listings are stale and unsold.

Q: What is the current state of mortgage rates?
A: Mortgage rates shot over 7% in October and have mostly stayed there through the end of the year.

Q: What is the current state of home prices?
A: Home prices continue to rise. The latest monthly price report from S&P CoreLogic Case-Shiller showed prices nationally up 3.6% in October compared with the same month a year earlier.

Q: What is the outlook for the new year?
A: The slower selling pace doesn’t bode well for the new year, especially with interest rates remaining elevated.