Just 25 out of every 1,000 U.S. homes (2.5%) changed hands in the first eight months of 2024, marking the lowest turnover rate in decades.
That's according to a new report from Redfin in which the brokerage conducted an analysis of housing turnover by comparing the first eight months of 2024 across different metro areas, home, and neighborhood types. Redfin is using turnover as a measure of housing availability, as it indicates how often homes are sold in a given area.
The analysis used data from between 2012-2024, but zooming out further, Redfin reported that this year’s turnover rate is the lowest in at least the past 30 years. Existing home sales were similar in the early-to-mid 1990s, but the number of homes that existed was much smaller — meaning the turnover rate was higher.
There were 37.5% fewer homes sold this year than during the middle of the pandemic buying frenzy in 2021 (40 of every 1,000) and 31% fewer homes sold than during the last pre-pandemic year in 2019 (36 of every 1,000).
Redfin noted that homes are changing hands at historically low rates for several interconnected reasons, one being elevated mortgage rates, with over three-quarters of mortgaged U.S. homeowners having a rate under 5%. While rates fell to the low 6% range in August, the drop has not yet resulted in a significant uptick in sales.
Another reason is rising prices and low supply. U.S. home prices have hit record highs this year, with just enough buyer demand to keep prices consistently ticking up; however, there are far fewer homes listed for sale compared to pre-pandemic levels.
Redfin also cited economic and political uncertainty as a reason for low turnover.
“Mortgage rates have already fallen more than one percentage point from their 2024 peak, but we have not yet seen a significant increase in the number of homes changing hands. Of the homes listed this year, many have gone stale because of the lack of demand — especially homes which needed a little extra work,” said Redfin Senior Economist Elijah de la Campa. “With the majority of homeowners locked into low mortgages, rates will need to keep falling consistently for many to feel comfortable moving on from the deals they secured years ago.”
The rate of homes being listed for sale also fell in the first eight months, to the lowest level since at least 2012 — the earliest year with listings data available. Just 32 out of every 1,000 homes were listed for sale in the first eight months of 2024, which is down 30% from before the pandemic in 2019 (46 listings per 1,000 homes) and 29% from the pandemic-driven buying spree in 2021 (45 listings per 1,000 homes).
Homes in suburban and rural areas change hands slightly more often than urban homes, with around 25 out of every 1,000 single-family homes and condos/townhouses in suburban and rural areas sold in the first eight months of the year, a slightly higher clip than the roughly 24 out of every 1,000 homes which sold in urban areas.
Since 2019, the turnover rate for single-family homes in suburban and rural areas dropped 32.9%, while condos/townhouses dropped 37.6%. In comparison, the turnover rate for single-family homes in urban areas dropped 25.8%, while the rate for condos/townhouses fell 35.2%.
A number of Sun Belt cities and metros adjacent to New York led the list of major metros with the highest turnover rate, based on Redfin’s analysis of the 50 most populous metros. Phoenix saw the most turnover of the major metros, with 38 out of every 1,000 homes changing hands. It was followed by Newark, N.J. (37 of every 1,000), Nashville, Tenn. (36 of every 1,000), and Tampa, Fla. (35 of every 1,000).
