US Homes for Sale on the Rise

The inventory of existing homes for sale rose to 1.2 million in April, according to data from the National Association of Realtors (NAR), marking the highest point since October 2022, as prices and borrowing costs remain elevated.

Compared to March, the available unsold homes in the market was up 9 percent, to 3.5 months’ worth of supply and jumped more than 16 percent from the same time a year ago, NAR reported.

The Context

Sales of existing homes fell by nearly 2 percent to a yearly rate of 4.14 million amid prices that have gone up by close to 6 percent. This has brought the median price to about $408,000, which Realtors say is the 10th straight month of annual price increases and the highest price ever for April.

Sales were also down across regions of the country. The Midwest saw sales drop by 1 percent in April, on a monthly basis. But prices were up 6 percent, to nearly $304,000, from this time last year. Sales in the Northeast fell 4 percent for the month and prices shot up 8.5 percent, to $485,000. The South reported a 1.6 percent decline in sales while prices accelerated nearly 4 percent, to about $366,000. The West registered a drop of 2.6 percent in home sales. The median price in the region soared more than 9 percent, to nearly $630,000.

Single-family home sales dropped at an annual rate of 3.74 million, a 2.1 percent decline from March, with prices up 5.6 percent in April compared to a year ago. Condominiums and co-op sales were unchanged, even as prices shot up more than 5 percent, to about $365,000.

The sales and price dynamics may shift as the inventory of homes available for sales jumps, according to NAR chief economist Lawrence Yun.

“Home prices reaching a record high for the month of April is very good news for homeowners,” Yun said in a statement. “However, the pace of price increases should taper off since more housing inventory is becoming available.”

Views

The 18-month high level of inventory in April is still low compared to where it was prior to the COVID-19 pandemic, Realtor.com chief economist Danielle Hale told Newsweek. In June 2019, for example, the inventory of homes available for sale was at 1.92 million.

“It’s not like people are talking about inventory being very abundant then, but in hindsight relative to where we are now, the pre-pandemic housing market seems much better supplied,” Hale said. “It’s nice to see inventory growing. It’s an improvement and one that is helping to drive home sales at some price points, but I would still hesitate to call this a well supplied market.”

A well-supplied market would be one that has about 1.75 million homes, she added.

Yun told Newsweek that more sellers putting their homes for sale helped increase the inventory in April.

“The reason for the increased inventory is that we’re coming off super-low inventory levels due to the ‘locked-in’ effect of homeowners unwilling to give up the low interest rates they secured during the first two years of the pandemic,” he said.

“However, the pent-up listings continue to grow from life-changing events, including but not limited to starting a new job with a different commute, divorces, death and estate sales, a new child in the family, the need to give up a smaller house for a larger one, and a retirement leading to trade-down.”

He added: “These factors exist and accumulate over time. So, the locked-in effect is not permanent. It loses power over time. In Florida, some homeowners are seeing costs rise related to insurance and condo fees and, as a result, are bailing out.”

What’s Next

Hale said that she expected inventory to improve this year going forward.

“We’re still a long way from a pre-pandemic level which I think was more balanced than [where] we are today. So I think there’s still a lot of room for improvement in today’s housing market,” she told Newsweek. “I do expect to see that improvement as we move throughout the year, which will improve conditions for buyers in the market.”

While the market may still be a seller’s market as elevated prices signal, homeowners may have to be more flexible than in recent months when putting up their homes for sale.

“It may mean that sellers have to be more aware of their competition on the market than they have been in the past few years,” Hale said. “But I think the market will remain seller friendly even if we see more home sellers in the market.”