What goes up must come down, eventually. For the last 14 months, the residential real estate market has just gone up and up and up, with few signs of slowing down or leveling off. Bidding wars, rising prices, and homes selling for way above asking have become the norm. The most recent data from June, however, shows that things may be starting to cool down.
According to a recent report in the Wall Street Journal, the housing market is finally showing some signs of returning to normalcy. More specifically, the number of new and active listings has gone up. The number of active listings bottomed out in April, when there were only 491,969 homes on the market in the entire country. In May, the number of listings rose slightly back above 500,000. June saw the first significant increase in active listings in over a year, with the number rising up to 548,864.
This is still only 49% of the active listings from April 2020, but it still represents a significant increase. It is the first sign that the aggressive sellers market of the last year is slowly cooling down. The fears that the market would completely dry up and run out of inventory entirely no longer seem tenable.
The number of new listings is also up. In June, 2021 there were 446,600 new listings. This is up from the low of December, 2020 when there were fewer than 250,000 new listings. It is in fact the highest monthly rate since September, 2019.
With the vaccination widespread and COVID increasingly a thing of the past, homeowners are a lot more confident to put their home’s on the market. Interest rates are still quite low, which means that mortgages are still quite affordable as well.
The rise in listings is most notable in high end homes. For houses priced over $1 million, the number of listings was actually up by 17.5% year over year for the week ending June 19. By contrast, the number of listings for homes less than $350,000 was down by 49% year over year in the same period.