July brought some good news for first-time homebuyers. New listings grew as smaller, more affordable homes hit the market.
Realtor.com’s July monthly housing report found new listings grew for the fourth month in a row, and those listings included a higher number of smaller homes. Homes for sale nationally dropped 33.5% year over year last month, and while inventory is still lower than it was a year ago, the report found the rate of decline is slowing.
Realtor.com chief economist Danielle Hale says July’s housing trends show the market is starting to reflect seasonal patterns of years past, even as the number of new listings grew higher than normal this summer.
“This is shifting the housing market balance in a more buyer-friendly direction, but buyers may not see as much price moderation as suggested by the national trend because it’s partly attributed to a shift toward smaller homes for sale,” Hale said in a press release. “Still, if these changing inventory dynamics continue, we could see a wave of real estate activity heading into the latter part of the year.”
New listings are continuing to surge as summer continues, while inventory is declining. More sellers entered the market in July, as inventory increased 6.5% year over year, higher than June’s 5.5% increase from 2020. While newly listed homes usually decline from June to July, this year, they remained steady down just 0.6% from June, the report found.
In July, these newly listed homes were smaller in size than in 2020, helping first-time homebuyers looking for something within their price range.
According to the report, the share of single-family homes between 750 and 1,750 square feet increased from 30.2% in July 2020 to 36.3% last month. Inventory of 3,000- to 6,000-square-foot homes decreased from 24.2% to 20.1%
New listings on average grew 11.1% year over year nationally, and more than half of the country’s 50 largest cities posted double-digit gains. Regionally, the largest increases were seen in the Midwest and West, where listings grew 19.8% and 11.3% respectively.
In Miami, new listings were actually down 7.7% in July.
Home prices held steady in July, due to the addition of more affordable homes to the market. The median list price of a home in July was $385,000, an increase of 10.3% year over year. As a benchmark, a 2,000 square-foot single-family home was up 18.6% year over year in July.
In July, Miami’s median list price grew 11.5% year over year to $450,000.
Almost half of the country’s largest markets had lower median list prices in July compared to a year earlier, again attributed to more affordable options.