In April, the inventory of existing homes for sale rose to 1.2 million, the highest level since October 2022, according to data from the National Association of Realtors (NAR). Sales of existing homes fell by nearly 2 percent to a yearly rate of 4.14 million, while prices saw a nearly 6 percent increase, bringing the median price to about $408,000, the highest price ever for April. Prices have been steadily increasing for 10 consecutive months. Sales were down across all regions of the country, with the Midwest, Northeast, South, and West all seeing declines in sales but increases in prices compared to the previous year.
According to NAR chief economist Lawrence Yun, the increase in available homes for sale may lead to a shift in sales and price dynamics in the market. Single-family home sales dropped by 2.1 percent in April, while prices rose by 5.6 percent compared to the previous year. Condominium and co-op sales remained unchanged, but prices increased by more than 5 percent to about $365,000. This surge in inventory is seen as positive news for homeowners, as it may lead to a tapering off of price increases due to the availability of more housing options.
Realtor.com chief economist Danielle Hale noted that while the 1.2 million inventory level in April marked an 18-month high, it is still low compared to pre-pandemic levels. She suggested that a well-supplied market would have around 1.75 million homes available for sale. Yun attributed the increase in inventory to more sellers putting their homes on the market, as the “locked-in” effect of homeowners holding onto low interest rates from the pandemic begins to fade. Factors such as job changes, life events, and rising costs in certain regions are contributing to more listings becoming available.
Looking ahead, Hale predicted that inventory levels would continue to improve throughout the year, providing better conditions for buyers in the housing market. While the market may still favor sellers due to elevated prices, homeowners may need to be more flexible in terms of competition and pricing when listing their homes. Despite these challenges, the market is expected to remain seller-friendly as more homes become available for sale. Overall, the increase in housing inventory is viewed as a positive development that could help balance out the market and potentially ease the pressure on home prices.
