The amount of homes for sale had its first year-over-year decline since September 2018 in June 2019, with the supply falling by 0.3%, according to Redfin.
Redfin also states that if supply growth continues to fall at the same rate it has since April, the number of homes for sale in September will see a year-over-year decline of more than 4%.
Growth of the amount of homes for sale peaked in January at 7.9%, but the supply has fallen ever since.
"Lower interest rates are bringing buyers back, but without enough homes for sale to meet demand, we expect to see more bidding wars, which will push prices up this summer," said Redfin Chief Economist Daryl Fairweather. "We expect small, inland markets where a typical home is still affordable for a middle-class family to heat up the most. Those markets, like Knoxville and Akron, are already experiencing double-digit annual price growth, and there is a lot of room for prices to continue to grow. Expensive metros like San Jose and Seattle may see moderate price growth this summer, but for the most part those markets have already peaked."
While the national average took a dip in June, 32 of the 46 largest U.S. metro areas had fewer homes for sale compared to a year earlier, and inventory never grew in some of the more affordable areas.
Oklahoma City, Oklahoma, where the average price of a home solid in May was just $184,900, had 15.3% fewer homes for sale in June compared to 2018, and has not seen annual growth since going negative in 2016.
Expensive metro areas with median prices above the national average have seen some of the biggest gains, according to Redfin. San Jose, California, saw for-sale inventory jump 43.6%—the largest increase in the nation—despite homes selling for an average of $1.17. Seattle, Washington, had a 21.9% increase and Boston, Massachusetts, saw a 21.3% increase.
Redfin, though, states the rate of growth has fallen from 2018, contributing to the decline in the national average.
The recent high-value of IPOs in San Francisco has not only led to bidding wars, but has caused the number of for sale homes to be 12% higher than it was last year.