The record growth in home prices over the past year driven by short supply has made homeownership less affordable for many Americans, especially for would-be first-time homebuyers and those searching for homes under $200K.
It’s also worth noting that mortgage rates have increased for the first time since July to 3%. Higher borrowing rates on top of ever-increasing price growth means demand for new purchases and refinances will soon slow down.
In September, there were 287,468 net new listings of homes on the market, marking a 14% decrease year-over-year. Broken down by price tier, homes listed between $0-$200K accounted for 18% of net new listings. Homes listed between $200K-$400K had 41.3% of net new listings, meanwhile $400K-$600K homes had 20.8% of net new listings, $600K-$1M homes had 13.3% of net new listings, and the $1M+ home had 6.6% of net new listings.
The decrease in net new listings was driven by a 10% decrease in new listing volume as well as a 14.7% increase in removals compared to last year. Homes in the $0-$200k price range underperformed in both net new listing volumes and contract volumes. The net new volume of homes in the $0-$200K price range is down 17.2% year-over-year; meanwhile, net new listings for the $200k-$400k, $400k-$600k, $600k-$1m, and $1m+ price bins are up 1.2%, 34%, 53.1%, and 55.9%, over the same time period.
Additionally, there were 352,185 listings that went under contract which is a 1.7% decrease from September 2020. The total volume of listings going under contract for the $0-$200k and $200k-$400k price bins are down 23% and 3.9% compared to last year. The total volume of listings going under contract in the $400k-$600k, $600k-$1m, and $1m+ price bins are up 25.3%, 45.6%, and 58.7%, over the same time period.
The nationwide supply shortage that developed in the wake of the COVID-19 pandemic continues to drive single-family home prices higher. For the week ending October 1, 2021, the median price of all U.S. single-family homes was $383,800 and the median closed price was $383,878. The median price of all single-family listings increased 7.5% and the median price of closed listings was 13.9%. The year-over-year change in net new inventory was positive for all four price bins below $1m, and only slightly negative for the $1m+ price bin. Since peaking in June and July, both listings and closed prices have decreased slightly as we progress into the winter season.
As a nationwide brokerage, HouseCanary is able to work with over 200 multiple listing services (MLS) across the United States. The core data for real estate analysis comes from public records, such as county tax assessors and recording offices.
