A Redfin report found the number of new listings in September fell 9% year-over-year (YOY). Closed home sales and active listings also dropped — by 5% and 19% YOY — respectively.
September marked the fourteenth month of consecutive double-digit price increases, with the median price of homes sold at $376,800, up 14% from the previous year. It was the slowest growth rate since December 2020.
“The severe lack of inventory is restricting home sales,” said Redfin Chief Economist Daryl Fairweather.
“Even though plenty of people bought homes last year, many homebuyers waited while the pandemic went from bad to worse and remote-work policies were finalized. The homebuyers who are just beginning their search are finding that the well has run dry. But I am hopeful that as it becomes easier to get building materials, we will finally have a strong year for new construction in 2022. That’s what the market needs more than anything.”
Homebuilders are rushing to respond to the severe underhousing hurting the market. Single-family building permits were up by more than 25% YOY in August, and builder confidence in the market has inched up as material costs slowly get better.
“The single-family building market has moved off the unsustainably hot pace of construction of last fall and has reached a still hot but more stable level of activity,” said Robert Dietz, Chief Economist of the National Association of Homebuilders.
“While building material challenges persist, the rate of cost growth has eased for some products, but the job openings rate in construction is trending higher.”
Median sales prices rose in every metro except Bridgeport, CT, where prices dropped 2.2% YOY. North Port, FL, Salt Lake City, and Austin, TX experienced the largest price increases.
Home sales fell in 66 of 85 metros, with the largest drops found in New Orleans, Bridgeport, CT, and Salt Lake City. New York, Honolulu, and San Jose, CA saw gains in sales, though they were still slightly down.
Austin, TX, Tacoma, WA, and Columbus, OH were the only metros that saw a YOY rise in seasonally adjusted active listings. The biggest declines were in Baton Rouge, LA, Salt Lake City, and Rochester, NY. New listings dropped in 75 of 85 metros.
The report also found that the typical home sold in September spent only 18 days on the market before going under contract, more than a week faster than the year prior but three days higher than June’s record low of 15 days.
Forty-eight percent of homes sold above list price, down 8% from June and 14% higher from the year prior. The average sale-to-list price ratio fell from 102.5% in June to 101%. It’s 1.6% higher than last year.