Active listings of homes for sale fell 1.4 percent month-over-month in November — the biggest drop since June 2023 on a seasonally adjusted basis, according to a report from Redfin. New listings dropped 2.2 percent month-over-month to the lowest level since April 2024 on a seasonally adjusted basis.
Home sellers are retreating in part because buyers are retreating, according to Redfin. Buyers are skittish due to high mortgage rates and economic jitters, which means many sellers aren’t getting the list price they hoped for. As a result, some are opting to delist their homes or not list at all.
The typical home that sold last month went for 1.6 percent less than its final list price — the steepest November discount in six years. The median home sale price rose slightly (plus-0.7 percent year-over-year to $433,222), but that was the slowest growth since June 2023 aside from this past May, when home prices grew at a slightly slower clip.
“Sellers have to price their homes very reasonably to attract interest,” Carlos Castillo, a Redfin Premier real estate agent in Los Angeles, said in a release. “I recently advised a seller in the Valley to drop their price because we weren’t getting much interest. Cutting the price drummed up four separate offers and helped the home sell above the original asking price. The challenge is that most sellers are also buyers, and homes are expensive, so they often need to get a certain amount for their house to afford the next one.”
Pending home sales fell 2.5 percent month-over-month on a seasonally adjusted basis in November — the largest decline since December 2024 — amid high housing costs and widespread uncertainty about the economy, according to Redfin.
Existing home sales were flat month-over-month (zero percent) and virtually flat year-over-year (0.8 percent), coming in at a seasonally adjusted annual rate of 4.27 million in November. Redfin economists expect existing home sales to end the year roughly flat with 2024, which was the worst year for sales since 1995.
The typical home that went under contract last month spent 53 days on the market, according to Redfin. That’s seven days longer than a year earlier and the slowest November pace since 2016.
Both buyers and sellers have been retreating from the housing market, but buyers have backed off faster over the past couple of years, according to Redfin. As a result, sellers far outnumber buyers, which means the buyers in the market hold negotiating power. Many buyers are successfully negotiating concessions and/or lower prices from sellers, and homes are taking a long time to sell in part because buyers feel they can take their time.
While mortgage rates have ticked down in recent months, they remain much higher than they were in 2020 and 2021, and Redfin agents say many house hunters are waiting to jump into the market until rates fall further.