Rising home inventory in June and longer times spent on the market are signaling a “slight” directional shift toward a buyer’s market, according to Realtor.com in a recent report. The number of active homes for sale climbed by nearly 37% in June compared to the same period one year earlier, marking the eighth consecutive month of inventory growth. The median home spent 45 days on the market, an increase of two days from June 2023, and this duration has been rising year-over-year for the third consecutive month in 2024.
“While the quantity of homes on the market still trails pre-pandemic levels, home buyers are seeing more options to choose from as inventory increases,” said Realtor.com Chief Economist Danielle Hale. “The combination of more for-sale homes and longer time on the market is beneficial for home shoppers as they have more selection and don’t need to feel as rushed in picking a place to call home.”
However, whether these factors will lead to more home sales depends on “how mortgage rates impact affordability in the second half of the year,” she added. The average 30-year fixed mortgage rate rose to 6.95% as of July 3, up from 6.86% a week earlier, according to Freddie Mac’s latest data.
Median list price per square foot increased by 3.4% year-over-year last month, while overall listing prices remained unchanged at $445,000. New listings advanced by 6.3%, and the share of active listings with price reductions grew by 4.2 percentage points to 18.3% in June.
Regionally, inventory surged by nearly 49% year-over-year in the South and 37% in the West, with the Midwest and Northeast also logging double-digit gains. Compared to June 2023, list prices rose in all regions except the South.
Meanwhile, pending home sales in the U.S. unexpectedly declined sequentially in May as demand cooled, according to data from the National Association of Realtors released at the end of June. On an annual basis, the forward-looking indicator of home sales based on contract signings dropped by a more-than-expected 6.6%.
Wedbush Securities remains cautious on homebuilders as the quarterly earnings season approaches, with DR Horton set to kick off the reports for the group on July 18. Wedbush will be looking for signs that move-up and luxury demand momentum, which has outperformed expectations this year, can maintain resilience over the next two to three quarters.
