Housing inventory is increasing with an uptick in more affordable homes, which could lead to a possible door opening for more first-time buyers. New listings rose 6.5% in July, marking the fourth consecutive month for annual increases.
“July housing trends show a market still working its way back toward some version of normal,” says chief economist Danielle Hale. “The feverish pace of home sales is beginning to follow historical seasonal patterns, while new listings grew at an unusually high rate for the summer months, further helping the inventory crunch. This is shifting the housing market balance in a more buyer-friendly direction, but buyers may not see much price moderation as suggested by the national trend because it’s partly attributed to a shift toward smaller homes for sale.”
Nevertheless, Hale says that if the change in housing inventory levels continue, “we could see a wave of real estate activity heading into the latter part of the year.”
More than half of the nation’s 50 largest metros posted double-digit gains in new listings, led by Columbus, Ohio (up 42.9%); Baltimore (up 36.9%); Cleveland (up 35.8%); Milwaukee (34.3%); and Richmond, Va. (up 30.1%). The largest increases in new listings occurred in the Midwest (up 19.8%) and the West (up 11.3%).
The report notes that new listings remain below a typical 2017–2019 market, down 9.5%, but more sellers are starting to enter the market as they realize the price gains for their homes.
List Prices Moderating?
The national median listing price in July was $385,000, a 10.3% increase year over year. However, prices are showing signs of moderating—June’s growth rate was 12.7% annually.
Twenty-two of the 50 largest markets posted lower median listing prices in July compared to a year ago. Still, economists attribute that to the uptick in smaller, more affordable housing inventory.