New Listings Rise as Summer Comes to a Close

New listings of homes for sale in the U.S. increased by 1.2% week over week, reaching their highest point in over three months during the four-week period ending August 16. This marks the fifth consecutive week of growth. It is important to note that this data has been seasonally adjusted.

The rise in new listings occurs amidst a slowdown in homebuying demand: Pending home sales decreased by 1.3% week over week, hitting their lowest level since March. Many prospective buyers are remaining on the sidelines due to economic uncertainty and elevated housing costs. The average weekly mortgage rate stands at 6.67%, just below the highest rate seen in 13 months, while the median home-sale price has increased by 1.8% year-over-year (YoY). A small relief for buyers is that the median asking price has dropped by 0.1%, marking the first decline since January, albeit a minor one.

Key Findings:

• The median asking price (seasonally adjusted) experienced its first decline since January.
• Pending sales reached their lowest level since March.
• New listings hit the highest level in three months.
• The share of homes sold above list price is up from 26%.
• The average sale-to-list price ratio rose to 98.9%.

An increasing number of sellers are entering the market, partly because many have accepted the current slower pace of the housing market; they recognize that they may need to sell at a slightly lower price than initially desired and that the process may take a bit longer. Numerous homeowners who have been hesitant since spring, waiting for a market rebound, are now choosing to list their properties. In certain regions, such as the Bay Area and South Florida, homebuying demand remains robust, and sellers in these areas are likely capitalizing on competitive market conditions.

Jamie Derouen, a Redfin Premier agent in the Houston area, noted that alongside market trends, there will always be new listings as there are individuals who need to relocate.

“Some of my clients are selling because they’re retiring and downsizing, some are relocating for a job, and some are growing their families,” Derouen said. “Some homeowners have been waiting for mortgage rates to fall and demand to surge–but now they realize that’s unlikely to happen anytime soon, so they’re taking the plunge now.”

Overall, Redfin’s economists indicate that the rise in new listings, combined with weak demand, could create a favorable situation for prospective homebuyers. Buyers who encounter a listing that piques their interest may have the opportunity to negotiate a deal; given that there are approximately half a million more sellers than buyers in the market, some sellers may be inclined to lower their prices and/or provide concessions.

Metro-Level Highlights (four weeks ending August 16):

Top five metros with biggest YoY increases in new listings:

1. San Jose, CA (16%)
2. St. Louis (13.8%)
3. Virginia Beach, VA (12.9%)
4. Boston (11.1%)
5. Houston (10%)

Top five metros with biggest YoY decreases in new listings:

1. Dallas (-13.6%)
2. Atlanta (-9.4%)
3. San Antonio (-6.9%)
4. Jacksonville, FL (-4.5%)
5. Fort Worth, Texas (-4.3%)

Metros with biggest YoY increases in pending sales:

1. West Palm Beach, FL (9.6%)
2. San Francisco (4.7%)
3. St. Louis (4.4%)
4. Montgomery County, PA (3.6%)
5. Cincinnati (3%)

Metros with biggest YoY decreases in pending sales:

1. Seattle (-17.9%)
2. Houston (-16.3%)
3. San Diego (-11.8%)
4. Denver (-11.6%)
5. Atlanta (-8.9%)

Note: Redfin’s metro-level rankings data includes the 50 most populous U.S. metros. Select metros may be excluded from time to time to ensure data accuracy. 

To read the full report, click here.