Redfin reveals change in home sales, housing market | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Homebuyers have had to deal with a national seller’s market for the last several years, according to a study by real estate brokerage Redfin. The term “seller’s market” indicates there are more buyers than houses for sale, so sellers have more power in real estate transactions.

In my years reporting on real estate, I’ve witnessed the various ways that the ongoing seller’s market has impacted potential buyers. The market is more competitive, so homes sell more quickly, and bidding wars result in higher sales prices. Basically, a seller’s market hurts home affordability.

But recent Redfin data has revealed that things are turning around for homebuyers. Much of the U.S. is experiencing a buyer’s market.

This means buyers now have more power in real estate transactions. The shift often leads to lower home prices, which is especially good news, as rising mortgage rates have hurt affordability over the last month.

According to the Redfin report, 52.2% of homes for sale sat on the market for at least 60 days in February, making them “stale listings.” This is the highest percentage of stale listings since 2019.

Buyer’s markets lead to stale listings

Redfin data showed that there were 630,000 more sellers than buyers nationwide in February. Supply outpaced demand, resulting in longer times on the market.

The annual number of homes for sale had increased 1.5% in February, and year sales were down 3.1%. The median sale price had also risen 1% year over year.

In February, the typical house that eventually went under contract had been on the market for 66 days. Looking at historical data for this time of year, that’s the most number of days in the last decade.

“Sellers know it’s a buyer’s market, but they still want to get as much money as they can for their home,” Jason Gale, a Redfin Premier agent in New Orleans, said in the report. “So they list on the high end, expecting buyers to negotiate down, and that’s leading to listings staying on the market for a long time.”

“There are still deals to be made, but nine times out of 10, homes are selling for under their asking price,” Gale continued. “But sometimes, the price is just too high, and sellers have to pull their home off the market after six months or so.”

Stale listings were most common in Miami, San Antonio, Pittsburgh, and West Palm Beach. All of these metro areas had well over 50% of their listings stay on the market for over two months. These cities are intense buyer’s markets, according to Redfin.

Stale listings were least common in the Bay Area, including San Jose, San Francisco, Oakland, Anaheim, and Seattle. Most of these metro areas are still buyer’s markets, but to a lesser degree than cities such as Miami and West Palm Beach. San Francisco actually has a fairly balanced market, so buyers and sellers are on a level playing field.

Housing data has shifted for March

Redfin releases data for the previous week every Thursday, so it doesn’t have the statistics for the final week of March yet. However, some of the data has changed so far since the end of February.

Looking at Redfin’s data for the last four-week period, houses’ median days on the market have been falling. The number finally hit below 60 days for the four-week period of Feb. 23-March 22, reaching 56.25 days. The percentage of homes selling in less than two weeks was also up 2.7% year over year.

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The number of homes sold was still down, but it’s been improving every week. Last week’s data showed that year-over-year homes sold had ticked down by 0.2%, which is definitely an improvement from February’s annual decrease of 3.1%.

Comparing recent weeks’ Redfin data to February’s total data isn’t exactly comparing apples to apples. We don’t have the final numbers for March yet, and March tends to be a busier home-buying month than February anyway. However, it gives us insight into overall trends as the homebuying season progresses.

How the Redfin data impacts homebuyers and sellers

It’s no surprise that the shift from a seller’s market to a buyer’s market affects the two groups in different ways. Whether you’re a buyer or seller, it’s crucial to know what you’re getting into as the home-buying season gets into full swing.

The longer a house sits on the market, the more anxious an owner may become to sell. This gives buyers leverage. Consider negotiating the price or asking for seller concessions to put toward closing costs, repairs, or HOA fees.
Stale listings can also hurt sellers because, as Redfin points out, buyers might be suspicious about why a property is taking a long time to sell.
Homes are selling for under the asking price, which helps offset the expense of rising mortgage rates. Buying a house could be a little more affordable than buyers think.
For sellers: Redfin recently unveiled a partnership with Compass to introduce phased real estate marketing. You can show your home on Redfin.com without logging “days on the market,” and it won’t display the price history or valuation estimates. Then, sellers get a sense of early buyer interest, price homes accordingly, and ideally sell faster.
Both buyers and sellers should talk to their real estate agents. Local buyer agents will know what negotiating strategies are appropriate for your market, and seller agents will help determine an appropriate price for your home.