The number of active listings was up 13% year over year for the week ending June 4, according to a report from Realtor.com.
Despite the double-digit increase, active inventory remains nearly 50% below the inventory level at the start of the COVID-19 pandemic and down 13% on a year-to-date basis.
New listings also were up during the week ending June 4, rising 2% compared to a year ago, but they are down 1% on a year-to-date basis.
According to Fannie Mae’s Home Purchase Sentiment Index, seller confidence was high due to climbing asking prices, which, in turn, has kept new listings in positive territory year-over-year for nine of the past 10 weeks. Experts believe seller confidence and rising home prices will continue to be an important driver of housing inventory recovery.
Compared to the same time period a year ago, the median list price was up 16.9%, marking the 25th straight week of double-digit price gains. However, it’s the first time in seven weeks that the growth rate was slightly smaller week-over-week.
As inventory levels start bouncing back, Realtor.com expects home price increases to eventually moderate. But so far, the increase in the number of active listings has yet to make a significant impact.
“The inventory recovery is expected to eventually help tame the frenzied pace of home price growth and today’s data offer a hint of relief on the horizon, though a very distant one. Typical asking price growth remains about three times faster than normal, as concerns about future mortgage rate hikes continue to motivate buyers to compete,” said Danielle Hale, Realtor.com’s chief economist, according to a statement.
The report also found homes spent five fewer days on the market than during the same week a year prior, but experts expect the increase in inventory to eventually slow the ultra fast-paced housing market of the past few years.
The average time a home spends on the market hit a new record-low in May. Typically, this feat is achieved during the height of the summer market. Overall, on a year-to-date basis the average time on market is nine days faster than it was a year ago.
“We will need to see much more inventory to meaningfully impact the rate of home price increases,” Hale said. “With more options, home shoppers may see a bit more negotiating room and time to make decisions, even as market conditions continue to favor sellers. Last week’s inventory trends offer promise, with the number of active listings rising double-digits over 2021 levels after just closing the gap a few weeks ago.”