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The housing shortage that has plagued the US for years appears to be finally easing, but a key driver of housing affordability offers little encouragement that the stagnant market will pick up again anytime soon.
A new report from Redfin says the number of homes for sale rose to a four-year high in November, up 12.1% year over year. But the main reason for the increase is that many homes on the market are not selling.
Redfin data shows that housing supply hit a four-year high in November, but that’s mostly because more homes for sale have been on the market for more than two months. (Liu Guanguan/China News Service/VCG via Getty Images/Getty Images)
More than half (54.5%) of homes on the market last month have been listed for more than 60 days, and many are considered too expensive by prospective buyers. According to Redfin data, that’s up 49.9% from a year ago, and is the largest share of old inventory in November since 2019.
The report said the average home that went under contract last month did so in 43 days, also the slowest pace for November since 2019.
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“A lot of the listings on the market are old or vacant. There’s a lot of inventory, but it doesn’t sound like enough,” said Meme Loggins, a Redfin Premier real estate agent in Portland, Oregon.
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“I explain to the sellers that their house will stay on the market if it’s not in good condition,” said Loggins. “Well-priced homes in good condition come off the market in three to five days, but higher-priced homes can last more than three months.”
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The data shows that Texas and Florida have the highest rates of old listings on the market. Miami has the largest share of homes on the market for more than 60 days of any other major municipality at 63.8%, followed by Austin, with 62.4% of listings that have been on the market for more than two months without going under contract.
The unaffordability problem has resulted in the majority of homes on the market sitting unsold for more than 60 days. (Fox Stories)
The housing market saw a flurry of demand-driven activity during the pandemic, but has stagnated as rising home prices and mortgage rates have led to an ongoing affordability crisis that has put homeownership out of reach for many Americans.
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Home prices will repeatedly break records in 2024, and a report from the National Association of Realtors’ (NAR) annual survey of buyers and sellers found share of first-time home buyers dropped from 32% in 2023 to 24% in 2024, the lowest share since the NAR began collecting data in 1981.
Lindsay Kornick of FOX Business contributed to this report.
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