A lack of homes for sale in the U.S. is dragging the housing market, according to a new report from Realtor.com.
Though the number of homes for sale rose, new listings remained scarce in March, according to the company’s March report. The increase in the number of homes for sale is “a reflection of more time spent on the market,” the company said, rather than new sellers joining the fray.
Aside from high mortgage rates, which push up the cost of homeownership for would-be buyers, a lack of homes will likely affect home sales as buyers are left with few options.
The supply of active listings for sale rose nearly 60% this March compared to last year, but it’s still nearly 50% below pre-pandemic levels. Newly-listed homes, for instance, continued to fall in March by 20%, compared to this time last year. Last month, that number only fell by 15.9%.
Listings are growing the most in the South, by 127%. And within the 50 biggest U.S. metro areas, the most growth was noted in Austin, Texas, where active inventory grew by 312%, followed by Raleigh, N.C. where inventory grew by 274%.
Only three markets in the top 50 had inventory declines on a year-over-year basis, including Milwaukee, Wis., Hartford, Conn., and New York, N.Y.
Realtor.com also found that more buyers are back in the market, but not at the same levels as a year before.
“Signs show that buyers are active in the spring housing market, even if they aren’t as numerous as they were during the pandemic,” Danielle Hale, chief economist for Realtor.com, said in a statement.
“Amid fewer new choices on the market and still rising home prices, home shoppers have shown that they are very rate sensitive, only jumping back in the market when rates dip, and so what happens with rates this spring will likely play a strong role in determining whether the housing market bumps along or picks up speed this year,” she added.
In March, a typical home spent 54 days on the market. That’s 18 days longer than the same time last year. But pre-pandemic, such as between 2017 and 2019, homes spent even longer on the market on average.
Realtor.com is operated by News Corp subsidiary Move Inc., and MarketWatch is a unit of Dow Jones, also a subsidiary of News Corp.
