Buying a home in the colder months is often a smart move, but this year is a bugger. A new report from real-estate firm Redfin shows that on average, a record 2% of the homes for sale on the U.S. market were pulled from listings every week in the 12 weeks leading up to Nov. 20. For buyers and sellers alike, that might sound alarming. Here is what’s going on.
Why is this happening?
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Redfin analyzed MLS data from 43 of the 50 most populated metropolitan areas in the country, determining sellers are delisting their properties because they’re not getting offers at their preferred price—or in some cases, no offers at all. The monthly mortgage payment on the median-asking-price home is also 40% higher right now than it was a year ago.
While there might have been a housing market frenzy last year, it looks like that has has really slowed down. Home prices spiked during the height of the pandemic, leading to “pandemic boomtowns,” but those locations—like Sacramento, Calif. and Austin, Texas—are seeing the biggest declines in listings now.
Which cities are hit hardest?
The 15 metropolitan areas with the most delistings in the 12-week period studied are:
- Sacramento, Calif. (3.6% of homes delisted on weekly average)
- San Francisco (3.4%)
- Oakland, Calif. (3.3%)
- Seattle, Wash. (3.2%)
- San Jose, Calif. (3%)
- Boston, Mass. (2.9%)
- San Diego (2.9%)
- Los Angeles (2.7%)
- Philadelphia (2.7%)
- Denver (2.7%)
- Detroit (2.6%)
- Providence, R.I. (2.6%)
- Anaheim, Calif. (2.5%)
- Indianapolis (2.5%)
- Portland, Ore (2.5%)
What does this mean for buyers and sellers?
This may not all be cause for despair. Revolution Mortgage’s Desiree Chappell told Lifehacker, “In the Houston area we have definitely seen the number of listings drop, but for our buyers, it has made purchasing more affordable in some cases, due to sellers being more willing to contribute to closing costs or repairs when previously, sellers could take the highest and best of multiple offers.”
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She pointed out that refinancing is an option for buyers to consider when mortgage rates drop. But sellers might want to consider waiting things out. Redfin’s David Palmer noted in the data release that he’s had sellers cancel listings, and he’s used to them doing so in the fall with the intention of relisting in the spring. But talk of an impending recession is making sellers nervous about the near future: “Now people are talking about trying again in another year or two once the economy improves.”