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Declining home sales and high mortgage rates led to a year-over-year increase in housing stock in September, according to Redfin.
Available homes increased 0.2% year-over-year and 0.7% month-over-month. New homes hitting the market rose by 3.6% from a year ago. However, with home prices already high, sales dropped across nearly 70% of all metro areas, including some of the most popular markets in recent years. Overall, housing sales declined 4.8% annually and 17.8% in September from August.
“Rising mortgage rates, paired with already high home prices, are giving pause to homebuyers in expensive West Coast markets,” Daryl Fairweather, Redfin’s chief economist, said in a press release.
“Some of these places are finally seeing the number of homes for sale surge after years of a supply drought. But buyers who earlier this year would have put in a bid on any home in their target neighborhood are now being more choosy. With home prices growing slowly, buyers want to be absolutely sure that the home they buy is a home they will stay in for years to come.”
At a 27.7% decline, Seattle led all markets with the largest year-over-year drop in housing sales. The 21.5% drop in Los Angeles was the fourth-largest and the 20.8% drop in San Jose, Calif., was the sixth-largest fall from a year ago.
“Last year and earlier this year, Seattle, San Jose and Denver were the hottest markets with homes selling in days, not weeks. These metros have now been replaced by Grand Rapids, Mich., Omaha, Neb., and Indianapolis as the fastest markets in the country,” said Fairweather. “This acceleration in Midwest metros is due to increasing demand, as new residents move inland in search of affordability, without an increase in homes available for sale.”