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The median listing price continued to register lower than last year, by 0.3% this week. Listing prices are still down from last year for a fourth week, but the size of the decline was smaller than in the previous few weeks. Despite the year over year dip, June’s median home list price was $445,000, up slightly from May’s $441,445 price. The typical asking price has not fallen more than one percent from last year’s high price: $450,000. While some forecasters are anticipating a crash in real estate prices, our latest 2023 housing outlook anticipates a more moderate decline of just 0.6% for the year. Affordability is a major challenge, but the number of homes available for sale remains limited and is likely a factor that is both holding back existing home sales and keeping prices elevated. Although existing home sales rose modestly in May, pending home sales–a more forward looking indicator–dipped in the same month.
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New listings–a measure of sellers putting homes up for sale–were down again this week, by 21% from one year ago. The number of newly listed homes has been lower than the same time the previous year for the past 52 weeks–an entire year. And this week’s data shows a more modest gap than the prior two weeks, but it’s still on par with what has been typical year-to-date. The economy continues to be relatively resilient despite higher interest rates which have dampened homeowner interest in selling. The lack of existing inventory has led to a stronger market for new home sales. It’s likely also showing up in the very grounded dreams we found that users of the fantastical Realtor.com AI Dream Home experience have. heavy dose of realism in what they’re asking for.
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Active inventory declined, with for-sale homes lagging behind year ago levels by 2%. As we lap the surge in inventory that occurred in 2022 as higher mortgage rates priced out many home shoppers, the number of homes for sale is not keeping up. With 1 in 7 homeowners choosing not to sell this year citing high mortgage rates, and even 4 in 5 home shoppers (82%) report feeling locked-in by their existing low-rate mortgage, the housing market is not getting the influx of homes for sale that it typically does, and this is reflected in what’s available for sale. We expect inventory in 2023 to continue to struggle to keep pace and likely decline for the year as a whole.
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Homes spent 13 extra days on the market compared to this time last year. For 50 consecutive weeks, it’s taken longer to sell a home compared to the same time one year ago. However, June housing data show that the typical home on the market in June spent 10 fewer days on market than in 2017 to 2019. In June, the typical home was on the market for just 43 days. Rising rents over the past few years may have pressured first-time home buyers to keep up their home searches even in stressful, fast-moving markets. With nationwide rents beginning to decline and homes taking longer to sell, potential first-time home buyers are likely to feel less urgency although high-costs still make the question of where to live feel high-stakes.