The gap between the number of home sellers and home buyers continues to widen.
According to a new report from Redfin, there were an estimated 46.3% more home sellers than buyers in the U.S. housing market in February or 629,808. That’s the largest gap in records dating back to 2013 and is up from 29.8% (or 449,409) a year earlier, Redfin noted.
“We’re seeing a lot more inventory on the market compared to the past two years because the mortgage rate lock-in effect is easing and there’s a lot of new construction,” said Justin Gomez, a Redfin Premier real estate agent in Omaha, NE. “This has been great for affordability, especially for the younger crowd. Our median home price is in the low $300,000 range. Two years ago, people were offering $15,000 over the asking price just to get a home, with multiple offers everywhere.”
Redfin sait defines a market with more than 10% more sellers than buyers as a buyer’s market. It has been a buyer’s market since May 2024, Redfin said.
When sellers outnumber buyers, buyers typically hold the negotiating power because they have a lot of options to choose from, the brokerage noted.
Redfin said that the number of homebuyers in the market fell 2.4% month over month in February to an estimated 1.36 million, while the number of sellers posted a smaller decline, falling 0.4% to an estimated 1.99 million.
Homebuyers are Retreating
The brokerage reported that homebuyers are retreating because of stubbornly high home prices and mortgage rates, layoffs, and mounting economic and political uncertainty. That retreat in home buyers has caused some sellers, many of whom are buyers themselves, to retreat.
In fact, some sellers are delisting after watching their homes sit on the market, while others are choosing not to list at all after seeing nearby homes sell for below the asking price.
Redfin reported earlier in March that relistings are beginning to rise, which could boost housing supply. New listings are also starting to climb slightly, the brokerage said, posting their second straight week of increases after four months of declines.
The strongest buyer’s market in February was Miami, Florida, which had an estimated 163% more sellers than buyers. Next was Nashville, Tennessee, (120%), Austin, Texas (112%), West Palm Beach, Florida (110%) and San Antonio, Texas (104%).
The Sun Belt skyrocketed in popularity during the pandemic, when scores of homebuyers moved in from more expensive parts of the country. To meet surging demand, homebuilders ramped up activity, which is one reason there are now a lot more homes for sale than people who want to buy them. The pool of buyers has also shrunk because soaring housing costs in recent years have priced many people out of the market.
New Construction’s Impact
Redfin noted that new construction can have a significant influence on whether negotiating power lies with buyers or sellers because it impacts the balance of supply and demand. It said the South and the West historically have issued the most building permits, while the Northeast and the Midwest (where the five seller’s markets are located) have issued the fewest.
Florida and Texas build more homes than other states.
Redfin said the strongest seller’s market in February was Newark, New Jersey, which had an estimated 31.1% fewer sellers than buyers. The other four seller’s markets were Montgomery County, Pennsylvania (-29%) Nassau County, New York (-25.8%), Milwaukee, Wisconsin (-25.2%) and New Brunswick, New Jersey 14.5%).
