Total Number of Homes for Sale Jumps by Record Amount as Housing Market Slowdown Continues

A 'For Sale' sign hangs in front of a home in Miami, Fla., on June 21, 2022. (Joe Raedle/Getty Images)

Home sale numbers in the United States rose by a record, while new listings fell amid a slowing down in the housing market, according to real estate brokerage firm Redfin.

There was a 15 percent increase in the total number of houses available for sale for the week ended Dec. 4 when compared to a year back, as noted in a news release on Dec. 8. This is the largest increase on record. New listings declined by more than 20 percent, indicating that more homes are just sitting on the market while potential buyers wait for a fall in home prices and mortgage rates.

The slowdown in the housing market was evidenced by the longer time it took to sell. A typical home in the market took 37 days to be sold, up from a record low of 17 in June. It is also higher than the 28 days from a year back, registering the highest annual slowdown.

Redfin Deputy Chief Economist Taylor Marr pointed out that the week has been “relatively calm and quiet” as one of the “most volatile years” in housing history nears its end.

He called next Tuesday’s inflation report the “500-pound gorilla in the room” and the Fed’s press conference the next day to bring in “much more clarity” as to how fast the mortgage rates will come down in 2023.

“Since we expect only a small decline in prices next year, mortgage rates will dictate housing affordability, and, as a result, demand and sales, in 2023. If rates continue declining, more buyers may wade back into the market, as they’ll have lower monthly payments,” he said.

Price Decline, Market Downturn

The Redfin report also highlighted an annual decline in home prices in 11 of the 50 most populous metropolitan areas in the United States, of which six are in California.

San Francisco saw the highest decline, at 7.8 percent, followed by 3.6 percent in San Jose, 2.2 percent in Los Angeles, 1.4 percent in Detroit, Michigan, 1.2 percent in Sacramento, and 1.1 percent in Pittsburgh, Pennsylvania. The remaining cities saw a price decline of 1 percent.

The latest S&P CoreLogic Case-Shiller report also states that home prices in the United States fell for the third straight month in September. The 20-City Price Index declined by 1.2 percent for the month, after peaking in June.

During an interview with CNN in late November, Bank of America CEO Brian Moynihan predicted a downturn in the housing market that will last for almost two years.

In a note last month, Ian Shepherdson, chief economist at the Pantheon Macroeconomics, stated that he expects the housing market to drop by 15–20 percent over the next year.