Housing market inventory in Texas is back above pre-pandemic levels. These states could be next
Housing market inventory in Texas is back above pre-pandemic levels. These states could be next
ResiClub analyzed the latest inventory data from Realtor.com. Here’s what it shows about shifts in the housing market.
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Given the absence of an excessive amount of existing homes for sale on the market, it makes sense that spiked mortgage rates and strained affordability haven’t resulted in more regional home price corrections.
We are starting to see national active listings rise (up 35% between May 2023 and May 2024). However, we’re still well below pre-pandemic levels (33% below May 2019).
Here’s how the total May housing inventory/active listings compare to previous years, according data from Realtor.com:
May 2017: 1,253,854
May 2018: 1,156,910
May 2019: 1,180,920
May 2020: 928,370
May 2021: 447,662
May 2022: 479,462
On a regional level, the year-over-year state shift varies a lot.
In Nevada, active listings are down 25% on a year-over-year basis as markets like Reno and Las Vegas tightened up following a brief home price correction in the second half of 2022.
Meanwhile, active listings are up 70% in Florida on a year-over-year basis.
The biggest Florida inventory increase is concentrated in sections of Southwest Florida. In particular, in markets like Cape Coral and Fort Myers, which were hard-hit by Hurricane Ian in September 2022. There’s now a combination of increased housing supply for sale (the damaged homes) coupled with strained demand (the result of spiked home prices, spiked mortgage rates, higher insurance premiums, and higher HOA fees). That has translated into market softening across much of Southwest Florida. In addition, Florida’s coastal condo market has new regulations following the Surfside condo collapse in 2021.
Why the inventory rise across most of the Sun Belt?
As new supply becomes available in Southwest and Southeast markets, and builders use affordability adjustments like buydowns to move it, it has put the existing market at a disadvantage. As resale inventory sits a little longer, inventory builds.
Click here to view an interactive version of the map below that shows which states are nearing pre-pandemic levels.
Texas is back above pre-pandemic inventory levels. And states like Florida, Arizona, and Idaho are almost there too.
However, most of the country still remains below pre-pandemic inventory/months of supply.
Much of the Midwest and Northeast, in particular, remains very tight.
Big picture: We’re observing some softening in many housing markets as higher mortgage rates temper the fervor of a market that was unsustainably hot during the pandemic housing boom; however, home prices in many housing markets are still rising.
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