Finally, the inventory of homes for sale is growing. In November, active home listings across the United States reached their highest level since 2020, marking a 0.5% increase month-over-month and a 12.1% rise year-over-year on a seasonally adjusted basis.
But buyers should wait before celebrating. The increase doesn’t necessarily mean the housing shortage is ending.
According to a new report by real estate brokerage Redfin, the increase in supply is largely driven by a backlog of unsold homes, many of which are perceived as overpriced by potential buyers.
In November, 54.5% of home listings remained on the market for at least 60 days without securing a contract, the highest percentage for any November since 2019. This is a significant jump from 49.9% in the previous year. Homes that did manage to go under contract took an average of 43 days, marking the slowest pace for November since 2019.
‘Stale’ inventory is on the rise
Meme Loggins, a Redfin Premier real estate agent in Portland, Ore., says the problem is the growing amount of “stale” inventory.
"A lot of listings on the market are either stale or uninhabitable,” Loggins said. “There's a lot of inventory, but it doesn’t feel like enough."
Loggins noted that homes priced reasonably and in good condition are selling rapidly, often within three to five days, while overpriced homes can languish for over three months. Homes priced at $650,000 or below are particularly prone to overpricing, leading to extended market times.
Portland is among the cities with a high share of stagnant listings, with 58.7% of homes remaining unsold for 60 days or more in November. It ranks seventh among the 50 largest U.S. metropolitan areas in that regard.
Lots of unwanted homes in Miami
Florida and Texas are experiencing the highest levels of stale inventory. Miami leads with 63.8% of listings unsold for over 60 days, followed by Austin (62.4%), Fort Lauderdale, (62.3%), San Antonio, (60.3%) and Orlando, FL (59.9%). The construction boom in these states, coupled with rising HOA fees, insurance costs, and frequent natural disasters, has contributed to buyer hesitancy, according to Redfin.
Florida, in particular, has seen a notable increase in stale inventory. Tampa reported a 56.9% rate of unsold listings for 60 days or more, up 12.3 percentage points from the previous year, the largest increase among major metros.
At the same time, Providence, R.I., and Milwaukee have the lowest shares of stale listings, with 38.2% and 38.8%, respectively. Interestingly, only three metros—Philadelphia, Chicago, and San Francisco—saw a decrease in the share of stale listings from the previous year.