In the midst of what is generally considered the peak of U.S. homebuying season, Zillow’s latest monthly report finds that home listings are beginning to pile up as buyers step back from the peak of home shopping season earlier than usual.
“A growing segment of homes that aren’t competitively priced or well marketed are lingering on the market. Sellers are increasingly cutting prices to entice buyers struggling with affordability,” said Dr. Skylar Olsen, Chief Economist for Zillow. “For years, the housing market has been defined by fast sales and few options. Now it’s starting to look more like it did before the pandemic in terms of competition, if not costs. As the wait for mortgage rate relief drags on, slower price growth and even dips in some areas will help buyers catch up on saving for a down payment.”
A rise in inventory
The total number of homes on the market has risen throughout the year, ticking up 4% from May 2024 to June 2024 to stand nearly 23% above last year’s low level. While inventory levels are still about 33% below pre-pandemic averages, that’s the smallest deficit since the fall of 2020, when the pool of available homes was quickly dropping. Inventory is reported to be higher than last year in all of the 50 largest U.S. metropolitan areas tracked by Zillow except two—New York and Cleveland—and rose month over month in all but five.
Attractive listings are selling relatively quickly. But buyers still in the market are enjoying a few more days to weigh their choices than they had last summer. Homes sold in June were typically on the market for 15 days before the seller accepted an offer. That’s five days shorter than pre-pandemic norms, the smallest difference since June 2020.
Zillow found that competition is easing fastest in the South, with all major Southern markets either neutral or buyer-friendly, with the exception of the Dallas and Raleigh metros.
Managing dollars makes sense
- Home values climbed month-over-month in 45 of the 50 largest metro areas in June, with the biggest gains reported in Buffalo (1.6%), Cleveland (1.6%), Pittsburgh (1.4%), Providence (1.3%), and Hartford (1.3%).
- Home values fell, on a monthly basis, in three major metro areas: Austin (-0.1%), Phoenix (-0.1%), and Tampa (-0.1%). Home values held steady in New Orleans and Denver.
- Home values were up from year-ago levels in 46 of the 50 largest metro areas. Annual price gains were reported highest in San Jose (12%), Hartford (10.5%), San Diego (9.4%), Providence (7.7%), and Los Angeles (7.6%).
- Home values were down from year-ago levels in four major metro areas: New Orleans (-6%), Austin (-4.6%), San Antonio (-2.7%), and Birmingham (-0.6%).
Relief on the horizon?
Home value growth has slowed as inventory rises. Annual appreciation was reported by Zillow to be 3.2% nationally, down from a 2024 peak of 4.6% in March. Monthly growth has decelerated to 0.6%—marking the slowest June appreciation since 2011.
Slower home value growth in the months ahead could give struggling buyers a chance to make up ground, as Zillow forecasts home values to rise just 1% nationally through June 2025.
Sellers are cutting prices more often to entice buyers, with nearly one-quarter of listings (24.5%) receiving a price cut in June, the highest rate for this time of year in Zillow records dating back to 2018.
Click here for more information on Zillow’s June 2024 Market Report.
