New Listings Rose to the Highest Level in 17 Months in February
As sellers get used to higher mortgage rates, housing supply is finally starting to rebound. However, it’s not rebounding enough to counter home price growth as high housing costs remain, which could mean many prospective buyers on the hunt remain hesitant to commit.
The biggest increase in six months, new listings jumped 3.8% month over month on a seasonally adjusted basis in February. This is the highest level since September 2022. Additionally, experiencing the largest annual gain since May 2021, new listings were up 14.8% year over year.
According to Redfin, Active listings, or the total supply of homes for sale, hit the highest level in a year. They climbed 0.8% from a month earlier on a seasonally adjusted basis, and were little changed (-0.1%) from a year earlier—the smallest annual decline in months.
New listings rose fastest from a year earlier in Texas and active listings rose fastest in Florida—the two states that have been building the most homes. In Florida, condo listings in particular are contributing to the jump in supply amid a surge in HOA and insurance fees.
“The housing market is nothing like it was two years ago during the pandemic homebuying frenzy, but it’s better than it was last year. It’s coming back,” said David Palmer, a Redfin Premier real estate agent in Seattle. “Sellers who were on the fence in 2023 are now listing. They’re more used to elevated rates now. There still aren’t enough listings to quench pent-up buyer demand, but it’s getting better.”
Nationwide, housing supply is on the rise because the “lock-in effect” is easing; eventually, homeowners who have been holding on to their ultra-low mortgage rates simply have to move.
