Available US Homes for Sale Drop 6% Year-Over-Year in the Four-Week Period Ending June 11th

Redfin reported on Thursday (6-15-23) that the total number of US homes for sale dropped 6% year-over-year during the four weeks ending on June 11th. This marks the largest decline in 13 months.

According to Redfin, new listings dropped 23%, continuing a 10 consecutive month streak of double-digit declines. Those added to the deepening post-pandemic inventory shortages; there are 39% fewer homes for sale now than there were in June 2018, five years ago.

Redfin says the inventory crunch is partially due to a homebuilding slump that has lasted for over a decade and partly to mortgage rates falling to record-low levels during the pandemic, then shooting higher. Mortgage rates have more than doubled since 2021, landing close to 7% during this week. The record-low mortgage rates of 2020 and 2021 drove a homebuying boom, which helped to deplete inventory. However, when rates started going up in the beginning of 2022, many would-be sellers backed off, failing to fill the inventory hole. Elevated rates discouraged homeowners who would prefer to hold onto a comparatively low rate from selling.

Adding additional background to the report and her analysis, Redfin’s Economic Research Lead Dr. Chen Zhao said:

“The Fed’s indication that there are more rate hikes to come is not what homebuyers want to hear. It’s likely to keep mortgage rates elevated and may even push them up a bit. People who are sitting on the sidelines, waiting for mortgage rates to decline, should know that’s unlikely to happen in the foreseeable future. If a home that’s in your price range and has everything on your wishlist hits the market, there’s no good reason to wait.”