September saw an unseasonal boost in new home listings, but analysts at Redfin remain doubtful that supply will be able to keep pace with demand, even as housing's seasonal slump starts to set in.
According to an analysis from the company, housing stock in all of its tracked markets totaled 563,377 in September, up 4.1 percent from August and 6.3 percent from a year prior. Part of that late-season jump came from a bump in new listings, which climbed 2.1 percent month-over-month (5.9 percent year-over-year) to 194,472.
Redfin says the increase in listings reflects a lack in confidence among sellers, who have delayed putting their homes on the market for fear it would take them longer to buy another home.
Even with the unexpected rise in inventory, analysts at Redfin expressed doubt that supply will be able to keep pace with demand in the coming months, especially with home affordability still looking favorable.
"Declining mortgage rates could create even more demand among buyers, who want to get in before an expected rise in rates next year," said Chief Economist Nela Richardson. "So even though inventory is rising, it may not be enough to spur a long-term turnaround in housing supply to meet demand."
At the same time, agents for the brokerage say they're seeing more caution among buyers, who sense the market swinging back to level ground.
"New inventory gets people's attention and gets them excited, but buyers are wary and know that new listings could be gone quickly if there is a lot of interest," said agent Tom Lewis, who works in Washington, D.C. "Many of them are hesitant to step into a multiple-offer situation because they have lost offers on other homes. But if a home sticks around for a few days, then they'll be more willing to bite."
Meanwhile, the company reported a 13.7 percent month-over-month decline in sales volume, with the total number of homes sold in its markets coming to 119,316. Redfin says the decrease reflects seasonal trends, as evidenced by the much smaller annual drop in sales on an annual basis—1.7 percent.
In other findings, the median sale price nationwide continued to tick downward, slipping 3.6 percent month-over-month in September to $268,700. Prices were up slightly year-over-year, climbing 3.9 percent.
Looking ahead, Redfin expects prices will continue to increase on an annual basis, though growth isn't anticipated to surpass September's rate of appreciation.
Bolstering that view is the fact that fewer homes are selling above their list price. According to the company, only 16.5 percent of homes sold in September went for a price above listing, a 30-month low.
"Homes are also staying on the market four days longer than they were last month, and the number of homes that sold in two weeks or less was down to 29.8 percent in September compared with 32.9 percent a year earlier," Richardson added.