Number of for-sale US homes falls 9.5%

The number of homes for sale in the United States declined 9.5 percent year-over-year this November, says the realtor.com November 2019 Housing Trends report released on Monday.

The demand has also increased, with the reason being a market with low interest rates.

By comparison, the US housing market was characterized by higher mortgage rates and increasing inventory in last year’s November.

George Ratiu, the senior economist with realtor.com, said, “As millennials — the largest cohort of buyers in U.S. history — embrace homeownership and take advantage of this year’s unexpectedly low mortgage rates, demand is outstripping supply, causing inventory to vanish.”

He added, “The housing shortage is felt acutely at the entry-level of the market, where most millennials are looking to break into the market for their first home.”

Ratiu further said, “The issue is further compounded by the fact that sellers tend to be more reluctant to list during the colder time of year when the market typically makes a seasonal slowdown.”

The shortage of available homes for sale in the US is accelerating, according to the real estate website’s listing data. In October, the number dropped 6.9 percent.

Compared to 2018’s November, the decline in this year’s November inventory equals a loss of 131,000 listings across the US.

In the US’s 50 largest metros, inventory declined by 8.8 percent year-over-year. Moreover, adding to the inventory woes of the nation, the number of new listings on the market has decreased by 7.7 percent since 2018.

One of the biggest barriers to buying a home still remains the higher prices, and it is expected that it will be the case heading into the next year. The below-$200k homes have vanished the most, decreasing by a considerable 16.5 percent year-over-year in November. This is up from 15.2 percent drop witnessed in October.

In November, declines were recorded across all price points. Mid-tier inventory costing between $200k and $750k also dropped by 7.4 percent year-over-year compared to October’s year-over-year decrease of 4.3 percent, whereas high-end inventory valued over $1 million dropped by 1.7 percent year-over-year as compared to October’s year-over-year increase of 1.3 percent.

Ratiu noted, “The inventory decreases seen across all value ranges could in part be attributed to a spill-over effect, as the lack of inventory has pushed buyers up the price chain to stretch their budgets and search for homes above their initial price target.”

Among the metros that recorded the sharpest declines in inventory were San Diego, Phoenix and Rochester (New York), which saw the drops of -28.1 percent, -24.1 percent and -22.4 percent, respectively.

There were four large metros that witnessed inventory increase year-over-year. They included Las Vegas, Minneapolis and San Antonio (Texas), increasing by +14.4 percent, +11.5 percent and +7.2 percent, respectively.

During November, homes in the US were sold in an average of 70 days, which is two days earlier than the sold days of last year. The largest drop in days on market were recorded by properties in Raleigh (North Carolina), Hartford (Connecticut) and Birmingham (Alabama), which saw, respectively, 10, 10 and 9 fewer days on the market compared to last year.

Realtor.com’s “Metros Seeing the Largest Declines in Inventory” table can be seen in the website’s press release, here.

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