Real estate economists expect house prices to accelerate less quickly and even begin to decrease in the coming weeks, as more owners place their homes on the market.
"Like a slow-turning ship," the supply side of the housing market is slowly gaining momentum, as analyst Tim Ellis of Redfin puts it.
Redfin economist Daryl Fairweather says that just as buyers are pulling back, more listings are hitting the market.
"I’m optimistic this will create conditions for a little bit of rain in this inventory drought. A homeowner who is thinking of selling to buy again is going to have a much easier time than they would have back in March," she said. "That’s because it’s becoming less competitive to buy and it is still a historically good time to sell.”
During one week ending July 18, almost 5% of listings saw price drops, a number on par with 2019 levels.
Price drops are more common in places such as Phoenix, Austin and Bend, Oregon, Redfin reports, where prices rose the fastest due to an inflow of Californians during the pandemic.
Overall, prices did continue to rise, that is in part due to mortgage rates hitting their lowest level (2.8%) since February this past week.
Interest in homebuying seems to be increasing in recent weeks based on Redfin's Homebuyer Demand Index, which remains higher than one year ago. Redfin points out increased real-estate-related Google searches as well as more home tours happening in the first half of the year.
What follows are some more key takeaways from Redfin's report, which is available in full at Redfin.com.
- The median home-sale price increased 20% year over year to $364,160, a record high.
- Asking prices of newly listed homes were up 12% from the same time a year ago to a median of $360,975. This is shy of the all-time high set during the four-week period ending June 27, and asking prices have been basically flat since late May.
- Pending home sales were up 9% year over year, the smallest increase since the four-week period ending June 28, 2020. Pending sales were down 11% from their 2021 peak during the four-week period ending May 30, compared to a 4% decrease over the same period in 2019.
- New listings of homes for sale were up 2% from a year earlier. The number of homes being listed is in a typical seasonal decline, down 8% from the 2021 peak during the four-week period ending May 23, compared to a 12% decline over the same period in 2019.
- Active listings (the number of homes listed for sale at any point during the period) fell 29% from 2020—the smallest decline since the four-week period ending January 17—and have climbed 10% since their 2021 low during the four week period ending March 7.
- 52% of homes that went under contract had an accepted offer within the first two weeks on the market, well above the 44% rate during the same period a year ago, but down 5 percentage points from the high point of the year, set during the four-week period ending March 28.