The worsening imbalance between supply and demand has marginalized buyers as many are unable to keep up with the explosive growth in house prices, fueled by fierce bidding wars. However, realtor.com’s weekly realtor.com property market report released on Thursday suggests that much-needed help may be on the way.
“The bright spot for buyers this week is that new sellers continue to offer homes for sale. This not only means new options to choose from, but it also helps slow the pace at which inventory for sale is shrinking “says the report.
New registrations rose 18 percent in the last week of April compared to the previous year – an increase of 13 percent compared to the annual growth in the first two weeks of March. Although last week’s growth was a slight slowdown from the previous two weeks, when new car registrations peaked at 40 percent, realtor.com’s chief economist Danielle Hale said this is still a positive sign that more home sellers are growing enter the market.
“The effects of the pandemic a year ago were most clearly visible in new offers. Many sellers have chosen to delay home sales prematurely as uncertainty was high and this was reflected in the number of new sellers entering the market, ”Hale said in the report. “Now we can see that the number of salespeople is increasing compared to the very low values of the previous year. Not only is this expected, it is needed. “
The modest increase in new registrations has cooled the average growth in listing prices from 17.2 percent to 15.4 percent. If the real estate market follows historical trends, buyers could see a bigger hiatus sometime this fall, Hale said.
“If house prices cool this year, as they did in the second half of the year, price growth will continue to slow, but house prices are noticeably higher compared to last year,” she said.
Although this week’s report revealed a silver lining, the battle for inventories is far from over as total active inventories are still down 52 percent year over year and market days have declined by 25 days. “These fast-moving conditions can be challenging, especially for first-time buyers,” the report said.
Hale said it will take at least 12 months for inventory to recover to “relatively normal” levels, which will offset some, but not all, of the financial burdens on buyers.
“In April, we still only saw three new salespeople this year for every four new salespeople we would have seen in April in the relatively normal 2017-2019 period,” the report said. “As more sellers gain confidence and return to the real estate market, we will find that the balance falls back somewhat in favor of buyers.”
“Our latest survey shows that more homeowners than normal are planning to put their homes up for sale in the next 12 months,” she added. “Even so, most markets are expected to remain solid seller markets for the remainder of the year.”
Email Marian McPherson