A record number of sellers took their homes off the market this fall
Redfin reports that 2% of U.S. homes were delisted each week during the past three months. In recent years the peak was around 1.6%.
- Pandemic boomtowns and West Coast cities saw some of the highest levels of delistings, while the Midwest and Northeast fared better.
- The lack of demand due to affordability has sidelined many sellers.
A high number of homes were taken off the market in the past three months, another sign that many sellers and buyers are trying to wait out the housing slowdown and economic uncertainty.
A record 2% of U.S. homes for sale were taken off the market each week during the past 12 weeks ending Nov. 20, according to a new report from Redfin. The pace of homes being delisted slowed in the week ending Nov. 27, declining to 1.9%.
Redfin looked at MLS data across 43 of the biggest 50 metro areas to compile this report.
November is commonly a time when homes are taken off the market as buyers and sellers focus on the holidays, but the numbers were higher than usual this year, an indication that sellers are disappointed that houses aren't selling as quickly. In recent years, the percentage of homes taken off the market peaked at around 1.6% each week in November.
"Some sellers are having a hard time grasping that we're not in a housing-market frenzy anymore — it's tough for them to swallow that they missed the boat on getting a high price," said Heather Kruayai, a Redfin real estate agent in Jacksonville, Florida. "By the time sellers realize their listing was priced too high, it has already been on the market for too long and is considered stale. I recently had two sellers take their homes off the market after 45-plus days."
One reason homes are coming off the market is buyers can't afford to pay the asking prices. A November Redfin report found that a homebuyer needs to earn $107,281 to be able to afford the $2,682 monthly mortgage payment for a median priced U.S. home. That's up 45.6% compared to a year ago when $73,668 was needed. During that time, the average hourly wage increased by far less, around 5%.
West Coast, boomtowns losing the most listings
Pandemic boomtowns — areas that experienced an influx of new buyers during 2020 and 2021 — and more expensive metros tended to see the biggest jump in delistings, according to the report. Sacramento led the way, with 3.6% of active listings being delisted per week, up from 2% a year ago. Austin (2.4%, up 1.5 percentage points), Seattle (3.2%, up 1.4 points) and Phoenix (2.4%, up 1.3 points) also ranked high on this list.
Six metros saw a decrease in the share of delistings from a year earlier, a sign that these markets have been relatively resilient during the slowdown. The share fell by less than one percentage point in Midwest and Northeast cities including Detroit and Warren, Michigan; Chicago; Newark and New Brunswick, New Jersey; and Montgomery County, Pennsylvania.
West Coast cities, many of which have some of the highest home prices in the nation, tended to see more homes leaving the market. After Sacramento, cities that had delisting levels of 3% or higher include San Francisco (3.4%), Oakland (3.3%), Seattle (3.2%) and San Jose (3%).
Pittsburgh had the lowest share of delistings, at 1.3%, followed by Cincinnati, at 1.4%.
These shifts are matching up with other data. In a recent report, the home finance technology company Knock found that pandemic boomtowns like Phoenix were already shifting to a buyers market, meaning that buyers will have more leverage than sellers. The report predicts that many of the large metro areas will be in buyers market territory by next summer.