In January, sellers became more eager to sell with the number of homes actively for sale growing 7.9% compared with one year ago, according to the Realtor.com January 2024 Housing Market Trends Report.
With the increase in inventory, median listing prices remained somewhat stable seeing a 1.4% increase compared with the same time last year. Yet, time spent on the market dropped to more than two weeks shorter than pre-pandemic levels.
"We are seeing increases in inventory and, importantly, gains in newly listed homes for sale indicating sellers are more ready to make moves. Time on market fell, signaling that buyers are ready to make offers on these new options," says Danielle Hale, chief economist of Realtor.com.
"While the drop in mortgage rates since last fall has helped boost buyer purchasing power, rates may not fall as quickly in the months ahead, and the anticipated improvement in affordability may be more uneven."
More than half of the 50 metros in the analysis saw new listings increase over the previous year, with the largest growth being seen in Denver (+21.3%), Seattle (+20.6%), and Miami (+20.2%). There were declines in new listings in some metros, including Chicago (-16.4%), New Orleans (-14.7%), and Philadelphia (-12.9%).
The typical home spent four less days on the market in January compared with the same time last year with some areas seeing even more decreased time. Las Vegas (-19 days), Phoenix (-14 days), and San Francisco (-13 days) saw the most decline in days on the market, while Indianapolis (+6 days), New Orleans (+4 days), and Birmingham, Alabama (+3 days) saw an increase.
Some markets saw an increase over typical 2017 to 2019 time on the market, including San Francisco (+9 days), Seattle (+9 days), Denver (+7 days), Portland, Oregon (+4 days), Austin, Texas (+3 days), San Antonio (+3 days), Los Angeles (+3 days), and San Jose, California (+1 day).
Considering slightly higher prices and higher mortgage rates compared with last January, buyers’ monthly payments have increased by roughly $108 per month, assuming a 20% down payment. As interest rates are falling or holding steady and listing prices growth has stabilized, the increase in the monthly cost to purchase a home has slowed, down from 6.1% year over year in December to January's increase of 5.4%.
To cover the increase in monthly expense, the required household income to purchase the median-priced home went up by $4,300 to $84,000, before accounting for the cost of tax and insurance.
