A report covering July data showed that despite a long-awaited increase in houses for sale, demand slipped again, cooling the sizzling sellers' market "by a few degrees," report Redfin analyst and economist Tim Ellis and Taylor Marr.
Their report shows new for-sale houses up 4% from a year earlier, and up 3% from the same period in 2019. This was the first time new listings have surpassed 2019 levels since the beginning of the year, Redfin reports.
While potential homebuyers are hesitant to make a move in this climate, Redfin's Chief Economist Daryl Fairweather says "buyers who threw in the towel may want to look again, because the market is tilting in their favor."
Pending sales recorded the smallest year-over-year increase in about a year. Month-over-month, they dipped twice as quickly as during the same period in 2009. Redfin also records requests for home tours and similar services in its H0mebuyer Demand Index, which also showed a decline of about 1.2%. Researchers from Redfin measured several more major market performance indicators including home prices, time to sell a house, and list-to-price ratios for the month, to name a few.
They found that despite increased listings, the market remains squarely in the sellers' favor. The median price of houses hit record highs again for the month at $364,430, 22% above where they were a year earlier. Homes continued to see faster than ever, averaging about 15 days on the market. That said, the time on the market, as well as the share of homes sold above the asking price, have flattened out in the past several weeks, the researchers reported. Asking prices of newly listed homes were up 12% from the same time a year ago to a median of $359,500, and more than half of homes sold above list price.
“Many buyers have backed away from the housing market and are waiting until more and better homes are listed,” Fairweather said. “Buyers don’t have the same sense of urgency that they did at the beginning of the year. They aren’t racing to buy before prices increase, because asking prices have already increased and stabilized. And they aren’t racing to buy before mortgage rates go up, because rates have dropped back below 3% and are likely to stay low.”