Active listings of homes for sale fell 1.4 percent month-over-month in August — the largest seasonally-adjusted decline since June 2023, according to a report from Redfin. They rose 9.7 percent from a year earlier — the smallest year-over-year increase since March 2024.
New listings fell 1.1 percent month-over-month to the lowest seasonally-adjusted level since January 2024 and were down 2.6 percent year-over-year, according to Redfin.
Sellers have been pulling back because homebuyer demand is sluggish, with sales still far below pre-pandemic levels, according to Redfin. Pending home sales and existing home sales were both little changed in August, with pending sales falling 0.4 percent from a month earlier on a seasonally adjusted basis and existing home sales rising 0.2 percent to a seasonally adjusted annual rate of 4,227,589.
“High housing costs and economic jitters have rattled buyers, and that unease has spilled over to sellers,” Redfin Head of Economics Research Chen Zhao said in a release. “We currently expect existing-home sales to end the year at around 4.05 million, or roughly flat compared to 2024, which was the worst year for sales since 1995. The good news is mortgage rates have been falling, giving homebuyers more purchasing power. We have yet to see that translate into a significant bump in sales, but that may change if rates continue declining; if we get a stronger-than-expected fall housing market, existing-home sales could end this year a little higher than last year.”
The average 30-year-fixed mortgage rate fell to 6.59 percent in August — the lowest monthly average in 10 months, according to Redfin. Rates have since fallen further, last week dropping to 6.26 percent — the lowest level in roughly a year. That has triggered a rise in refinancing activity among existing homeowners, but many prospective homebuyers are still waiting in hopes that rates fall further. The Federal Reserve cut its benchmark interest rate, but that was already priced into mortgage rates. Redfin economists expect mortgage rates to remain steady in the near term as market participants await further economic data, particularly the next jobs report on Oct. 3.
“I think the magic number is 6 percent,” Chicago-based Redfin Premier real estate agent Beth Behling said. “Prospective homebuyers are paying attention to mortgage rates, and if they drop to 6 percent, I think we’ll see a flood of interest.”
The median home sale price rose 1.7 percent year-over-year in August to $440,004 — the biggest uptick since March and the highest August level on record for Redfin.
Home prices may be heating up because the pool of homes for sale is shrinking, according to Redfin. New listings fell from a year earlier in 44 of the 50 most populous metropolitan areas in August. By comparison, only 20 metros posted a year-over-year decline the prior month.
Meanwhile, there was an increase in the number of metros seeing prices climb; 42 of the 50 top metros saw median sale prices rise from a year earlier in August, compared with 31 metros in July.
There are far more sellers in the market than buyers, and Redfin reported this means buyers in many areas are able to find deals and get concessions from sellers.
While sellers have been retreating, they still outnumber buyers by 35.2 percent — the second-largest margin on record. There were 3.3 months of for-sale housing supply in August — the highest August level in a decade.
Supply is building in part because a lot of homes are lingering on the market, Redfin reported. The typical home that went under contract last month did so in 47 days, marking the slowest August since 2016. The typical home also sold for 1.2 percent less than its final asking price — the steepest August discount since 2019.
“It definitely feels like a buyer's market,” Palm Springs, Calif-based Redfin Premier real estate agent Nikkolene Byron said. “Most homes for sale today only get one offer. I see multiple offers occasionally, but not multiple super strong offers like we saw during the pandemic homebuying frenzy — now they’ll come in lower than the seller wants or the buyer will ask for concessions like money toward closing costs.”
Sellers in some markets are starting to get smarter about pricing competitively in order to sell their homes quickly, Redfin agents say.
Here are some metro-level highlights from August:
- Median sale prices rose most from a year earlier in Detroit (10 percent), Cleveland (8.7 percent) and New Brunswick, N.J. (7.8 percent). They fell in seven metros, with the largest declines in Dallas (-3.3 percent), West Palm Beach, Fla. (-1.7 percent) and Phoenix (-1.1 percent).
- Pending sales rose most in Pittsburgh (11.4 percent), Cleveland (8.6 percent) and Phoenix (6.4 percent). They fell most in Detroit (-8.6 percent), Miami (-8 percent) and Seattle (-8 percent).
- Home sales rose most in Indianapolis (8.9 percent), Houston (6.8 percent) and Phoenix (4.1 percent). They fell most in Las Vegas (-15.8 percent), Fort Lauderdale, Fla. (-13.4 percent) and Miami (-13.1 percent).
- New listings rose in six metros, with the largest increases in Pittsburgh (3 percent), Detroit (2.9 percent) and New Brunswick (2.6 percent). They fell most in Orlando, Fla. (19.6 percent), Fort Lauderdale, Fla. (-15.4 percent) and Tampa, Fla. (-15.3 percent).
- Active listings rose most in Las Vegas (23.7 percent), Dallas (18.1 percent) and Anaheim, Calif. (17.8 percent). They fell in three metros: San Francisco (-7.4 percent), San Jose, Calif. (-2.8 percent) and Chicago (-1.7 percent).