Redfin Reports Housing Supply Just Hit a Four-Year High, Partly Because So Many Homes Are Sitting on the Market Unsold

Rhea-AI Summary

Redfin (RDFN) reports that active housing listings reached their highest level since 2020 in November, increasing 0.5% month-over-month and 12.1% year-over-year. However, this surge is largely attributed to unsold homes, with 54.5% of listings remaining on the market for 60+ days - the highest November share since 2019.

The typical home took 43 days to sell, marking the slowest November pace since 2019. Miami leads among top 50 metros with 63.8% of stale listings, followed by Austin (62.4%) and Fort Lauderdale (62.3%). Florida and Texas show the highest shares of stale inventory due to increased construction, rising HOA fees, insurance costs, and natural disaster risks. Conversely, Providence, RI has the lowest share at 38.2% of listings staying on market for 60+ days.

Positive

• Total housing inventory increased 12.1% year-over-year
• Some well-priced homes in good condition are selling within 3-5 days

Negative

• 54.5% of listings remained unsold for 60+ days, highest since 2019
• Average time to sell increased to 43 days, slowest November since 2019
• Market showing signs of pricing misalignment with buyer expectations
• Florida markets experiencing increased stale inventory due to high costs and risks

Insights

Real Estate Market Analyst

The surge in housing inventory to a four-year high, coupled with 54.5% of listings sitting unsold for 60+ days, signals a significant market inefficiency. This mismatch between pricing and buyer expectations is creating artificial supply inflation. The regional disparities are particularly telling - Florida and Texas markets showing the highest stale inventory rates (Miami at 63.8%, Austin at 62.4%) reflect localized market corrections.

The 12.1% year-over-year increase in active listings isn't indicative of a healthy market expansion, but rather a buildup of overpriced inventory. The stark contrast between quick-selling appropriately priced homes and stagnant overpriced listings suggests a pricing recalibration is necessary. This is particularly evident in the sub-$650,000 segment, traditionally the most active market segment, now showing signs of price sensitivity.

The data suggests we're entering a market rationalization phase where sellers will need to adjust expectations. Markets with the lowest stale inventory rates (Providence at 38.2%, Milwaukee at 38.8%) demonstrate that proper pricing remains the key to maintaining healthy market velocity.

Insurance Risk Analyst

The rising stale inventory in Florida markets deserves particular attention from an insurance perspective. The mention of high insurance costs as a deterrent to buyers isn't just a passing concern - it's a structural market issue. Florida's property insurance crisis, exacerbated by natural disaster risks and increasing HOA fees, is creating a compound effect on market liquidity.

The fact that Florida hosts three of the five metros with the largest year-over-year inventory increases suggests that insurance-related costs are becoming a major factor in purchase decisions. This trend could continue to pressure market dynamics, particularly in coastal areas where insurance premiums are highest. The situation represents a systemic risk that could further impact market velocity and pricing expectations in these regions.

Over half of home listings last month sat on the market for 60 days or longer–the highest November share since 2019. That’s a major reason housing supply jumped 12%.

SEATTLE--(BUSINESS WIRE)-- (NASDAQ: RDFN) — Active listings—the total number of homes for sale—climbed to the highest level since 2020 in November on a seasonally adjusted basis, rising 0.5% month over month and 12.1% year over year. For all the talk of America’s housing shortage, one would think that’s great news. But the story is nuanced, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

A major reason for the jump in supply is a pileup of unsold homes, many of which buyers have deemed undesirable because they seem overpriced.

Over half (54.5%) of home listings in November sat on the market for at least 60 days without going under contract. That’s the highest share for any November since 2019 and is up from 49.9% a year earlier. The typical home that did go under contract in November did so in 43 days, the slowest November pace since 2019.

“A lot of listings on the market are either stale or uninhabitable. There's a lot of inventory, but it doesn’t feel like enough,” said Meme Loggins, a Redfin Premier real estate agent in Portland, OR. “I explain to sellers that their house will sit on the market if it’s not fairly priced. Homes that are priced well and in good condition are flying off the market in three to five days, but homes that are overpriced can sit for over three months.”

Loggins said that homes $650,000 or below typically attract the most competition from buyers, but those homes are often the ones sitting on the market now because sellers in that price range are most likely to overprice.

In Portland, 58.7% of listings in November lingered on the market for at least 60 days without going under contract—the seventh highest share among the 50 most populous U.S. metropolitan areas.

Texas and Florida Have the Highest Share of Stale Inventory

In Miami, 63.8% of listings in November were on the market for 60 days or longer without going under contract—the highest share among the top 50 metros. Next came Austin, TX (62.4%), Fort Lauderdale, FL (62.3%), San Antonio (60.3%) and Orlando, FL (59.9%).

Florida and Texas have been building more homes than anywhere else in the country, which is one reason inventory, and thus, stale listings, are on the rise. Surging HOA fees, high insurance costs and destructive natural disasters are also making many Florida house hunters hesitant to pull the trigger. Florida is home to three of the five metros that saw the largest year-over-year increases in active listings last month.

Florida has also seen the biggest increase in stale inventory. In Tampa, 56.9% of listings last month were on the market for at least 60 days without going under contract, up 12.3 percentage points from a year earlier. That’s the largest gain among the top 50 metros. Next came Fort Lauderdale (12 ppts), Orlando (11 ppts), San Diego (11 ppts) and West Palm Beach (11 ppts).

Providence and Milwaukee Have the Lowest Share of Stale Listings

In Providence, RI, 38.2% of listings in November were on the market for at least 60 days without going under contract—the lowest share among the top 50 metros. Next came Milwaukee (38.8%), Montgomery County, PA (41.4%), Warren, MI (41.7%) and San Jose, CA (41.8%).

There are just three metros where the share of stale listings decreased from a year earlier: Philadelphia (-1.7 ppts to 51%), Chicago (-0.7 ppts to 44.9%) and San Francisco (-0.5 ppts to 53.4%).

To view the full report, including a chart and additional metro-level data, please visit: https://www.redfin.com/news/unsold-housing-inventory-november-2024

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, and title insurance services. We run the country's #1 real estate brokerage site. Our customers can save thousands in fees while working with a top agent. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than $1.6 billion in commissions. We serve approximately 100 markets across the U.S. and Canada and employ over 4,000 people.

Redfin’s subsidiaries and affiliated brands include: Bay Equity Home Loans®, Rent.™, Apartment Guide®, Title Forward® and WalkScore®.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241230812035/en/

Contact Redfin

Redfin Journalist Services:

Kenneth Applewhaite

press@redfin.com

Source: Redfin

FAQ

What was RDFN's reported housing inventory change in November 2023?

Redfin reported that active housing listings increased 0.5% month-over-month and 12.1% year-over-year in November 2023, reaching the highest level since 2020.

Which US cities have the highest percentage of stale housing inventory according to RDFN?

Miami leads with 63.8% of stale listings, followed by Austin (62.4%), Fort Lauderdale (62.3%), San Antonio (60.3%), and Orlando (59.9%).

How long did it take for typical homes to sell in November 2023 according to RDFN?

According to Redfin, the typical home took 43 days to sell in November 2023, which was the slowest November pace since 2019.

Which US cities showed the lowest percentage of stale housing inventory in RDFN's report?

Providence, RI had the lowest share at 38.2%, followed by Milwaukee (38.8%), Montgomery County, PA (41.4%), Warren, MI (41.7%), and San Jose, CA (41.8%).

What factors are contributing to Florida's increasing stale housing inventory according to RDFN?

According to Redfin, Florida's increasing stale inventory is due to increased home construction, surging HOA fees, high insurance costs, and risks from natural disasters.