A record 2 percent of U.S. homes for sale were delisted each week on average during the 12 weeks ending Nov. 20, compared with 1.6 percent one year earlier, according to a new report from Redfin.
That share dropped slightly in very late November, declining to 1.9 percent during the 12 weeks ending Nov. 27, which included the Thanksgiving holiday, according to Redfin.
Analysts say that sellers are taking homes off the market because they’re often receiving no offers for the price they want to sell for, and sometimes, no offers at all. They attribute that to a sharp drop in homebuyer demand driven by rising mortgage rates and persistently high home prices.
While mortgage rates have dipped slightly since mid-November, the monthly mortgage payment on the median-asking-price home is still 40 percent higher than it was one year ago.
“Some sellers are having a hard time grasping that we’re not in a housing-market frenzy anymore—it’s tough for them to swallow that they missed the boat on getting a high price,” said Heather Kruayai, a Redfin real estate agent in Jacksonville, Fla. “By the time sellers realize their listing was priced too high, it has already been on the market for too long and is considered stale. I recently had two sellers take their homes off the market after 45-plus days.”
Pandemic boomtowns see biggest delisting jumps
In Sacramento, Calif, 3.6 percent of active listings were delisted per week on average during the 12 weeks ending Nov. 27, up 1.6 percentage points (ppts) from one year earlier, Redfin data shows.
That’s the largest increase among metros Redfin analyzed. Next comes Austin, Texas (1.5 ppts), Seattle (1.4), Phoenix (1.3) and Denver (1.2).
All five of those markets saw home prices skyrocket during the pandemic, as most surged in popularity among remote workers. Now, with many buyers priced out, they’re among the fastest cooling markets in the country. In Austin, the median home-sale price was up a record 43.5 percent year-over-year in the spring of 2021, but growth had shrunk to just 3.7 percent as of October 2022. In Sacramento, there was 0 percent annual home-price growth in October, compared with as much as 29.3 percent last spring.
“I’ve had many sellers cancel listings,” said David Palmer, a Redfin real estate agent in Seattle. “Usually, sellers who pull their listings off the market in the fall do it with the intention of listing again in the spring. But with the word ‘recession’ out there, there’s not as much optimism about spring being a better market. Now people are talking about trying again in another year or two once the economy improves.”
Six metros saw a decrease in the share of delistings from a year earlier. The share fell by less than 1 percentage point in Warren, Mich., Chicago, Newark, N.J., New Brunswick, N.J., Detroit and Montgomery County, Pa.
West Coast markets have highest share of delistings
Sacramento not only saw the biggest year-over-year jump in delistings; it also had the highest overall share, with 3.6 percent of for-sale homes delisted per week on average during the 12 weeks ending Nov. 27. It was followed by San Francisco (3.4 percent), Oakland, Calif. (3.3), Seattle (3.2) and San Jose, Calif. (3).
Pittsburgh had the lowest share of delistings, at 1.3 percent, followed by Cincinnati, at 1.4. Rounding out the bottom five are New Brunswick (1.5), Newark (1.6) and Virginia Beach, Va. (1.6).