It’s official – housing inventory in America is at a crisis level. The number of active listings hit an all-time low during the week ending November 28, according to a Redfin report published on Wednesday.
During the four week period ending November 28, the number of active listings was a 23% decrease compared to the same time period in 2020 and a 42% drop compared to 2019. The number of new listings was also down compared to 2020, dropping 4%, but it was 12% higher than the number of new listing during the same time period in 2019.
“The number of homes for sale typically declines another 15% in December,” Daryl Fairweather, Redfin chief economist said in a statement. “That means that by the end of the year, there will likely be 100,000 fewer homes for sale than there were in February when housing supply last hit rock bottom. I think more new listings will hit the market in the new year, but there will also be a long line of buyers who are queuing up right now.”
Despite the seasonal changes going on outside, demand remains strong. During the same four week period 45% of homes that went under contract had an accepted offer within the first two weeks, up from 39% in 2020. But perhaps even more impressively, 33% of homes had an accepted offer within one week, up from 27% a year prior. Overall, the median number of days a sold home sat on the market during this period was 25, as compared to 31 days in 2020 and 46 days in 2019.
Ever-tightening housing inventory and steady demand has resulted in median home sale prices hitting a new all-time up of $360,375, just two weeks after hitting another all-time high. This marks a 14% year-over-year increase and a 31% increase from 2019. In addition, 43% of homes sold during this period , sold over list price, with the average sale-to-list price ratio coming in at 100.5%.
Experts believe that beside low housing inventory, steady mortgage rates may also be fueling the continued strong levels of demand.
“Headlines and new restrictions related to the omicron variant of the coronavirus might fuel some uncertainty and volatility in the economy,” Fairweather said in a statement. “In the short term, global interest rates, including mortgage rates, could fall. In this extremely tight housing market, we would quickly see a proportional increase in competition and home prices.”