According to the latest weekly housing trends report from Realtor.com, new listings in the US increased by just 1.5 per cent during the week ending August 2 compared to the same period last year.
This reluctance comes as inventory continues to build while buyers remain hesitant due to high mortgage rates and affordability challenges.
New listings have been declining month over month since April, indicating sellers are pulling back as market conditions in many metros shift to favour buyers.
Realtor.com Senior Economic Research Analyst Hannah Jones explained the current situation facing homeowners.
“Homeowners are less eager to get into the market as inventory continues to build and buyers keep to the sidelines,” Ms Jones said.
The overall number of homes for sale increased 22.8% year over year, marking the 91st consecutive week of annual gains in home supply.
Approximately 1.1 million properties were listed for sale, the highest inventory level since late 2019 and the 13th straight week above the million-listing threshold.
Despite this growth in inventory, the pace of sales has slowed considerably.
Properties spent six days longer on the market last week compared to a year ago, reflecting the sluggish selling environment, weighed down by economic uncertainty and high housing costs.
“Sellers are having to wait longer for their homes to move, and many are making a list of the pros and cons of waiting for buyers, lowering their listing price, or taking their home off the market altogether,” Ms Jones said.
The market adjustment is evident in the rising number of price reductions and delistings.
In June, delistings surged 48% year over year, while more than 20% of all listed homes in July featured price cuts.
Realtor.com Senior Economist Jake Krimmel described the current market as a “game of chicken,” with sellers anchored to higher list prices either because they’re not in a rush to sell or are in denial about their eroding leverage.
“Right now though, sellers by and large seem quite anchored to higher list prices, whether that’s because they are not in a rush to sell and willing to wait, or because they are in denial about how their leverage is eroding,” Mr Krimmel said.
For new listings to increase, sellers would need to see signs that they could get their desired price when they want it.
This could happen with falling interest rates, a stronger labour market, or a resolution to economic uncertainty.
Meanwhile, home prices have barely moved, with the median list price increasing just 0.8% compared to the same week in 2024. The median list price per square foot rose 0.4% year over year, continuing its nearly two-year growth streak.
“Many potential buyers are still being priced out despite rising supply,” Mr Krimmel said.
“And meanwhile, potential sellers are also staying on the sidelines or harbouring unrealistic price expectations despite extremely low demand.”
