Rising mortgage rates might be putting pressure on the housing market, but recent positive developments—more home inventory, stable home prices, and an increase in home price reductions—offer a glimmer of hope.

The latest monthly housing report from Realtor.com® reveals that the total number of homes for sale in April was 30.4% higher than last year, marking six consecutive months of inventory growth. Homebuyers this spring can also benefit from a surge in fresh listings, which are up 12.2% compared to last year.

“The number of homes actively for sale was notably higher compared with last year,” says Realtor.com Chief Economist Danielle Hale. “Sellers continued to list homes at a greater rate than last year. This has led to a promising increase in more affordable homes for sale, especially in the South.”

Home Prices Hold Steady

Home prices have increased seasonally, from $424,900 in March to $430,000 in April, but remain flat year-over-year.

“Whether buyers and sellers see the current home price trend as good or bad depends on their perspective,” says Hale. “Some buyers hoping for a price drop to improve affordability might be disappointed by flat prices. However, in an environment of long-term low affordability, stable prices can be seen as a market correction.”

Another positive for budget-conscious buyers is that sellers are adjusting to market conditions, with price reductions becoming more common.

“Sellers are continuing to adapt, with price reductions remaining above last year’s levels,” says Hale. Indeed, the percentage of homes with price reductions increased to 15.5% in April, up from 12.3% last year.

Housing Inventory on the Rise

The South stands out as the best region for homebuyers, offering the most listings and affordability.

In April 2024, Southern states accounted for more than half (56.7%) of all available inventory and led with the most new listings at 19.7%. Inventory also rose by 18.4% in the Midwest, but only by 7.5% in the West and 2.9% in the Northeast.

Florida cities led the inventory growth, with Tampa (+69.5%), Orlando (+64.2%), and Jacksonville (+59.1%) seeing significant increases.

For the past three months, homes priced between $200,000 and $350,000 have outpaced all other price categories, growing by 41.0% year-over-year, primarily driven by the South. Buyers in this price range can find attached homes such as condos, townhomes, or row homes.

Inventory Up in Major Cities

In April, all but five of the 50 largest metros saw an increase in listings compared to last year. New listings also rose in 48 of the 50 metros.

The freshest listings were in Seattle (+46.5%), San Jose, CA (+40.6%), and Austin, TX (+36.1%).

Despite this increase, only three metros had more newly listed homes than before the COVID-19 pandemic. The future pace of inventory growth will likely depend on how potential sellers respond to rising mortgage rates.

“If mortgage rates remain elevated, we might see a return to the scarce inventory patterns of the past few years,” says Hale. “The coming months will test whether homeowners are ready to sell despite high rates or remain sensitive to interest rates like buyers.”

The Spring Market in Full Swing

Despite high mortgage rates, buyers are actively purchasing homes.

The typical home spent 47 days on the market, two days less than last April and nine days less than pre-COVID-19.

The decision for buyers and sellers to enter the spring market will ultimately come down to their personal economic situations.

“It’s a challenging market, so I empathize with both buyers and sellers,” says Hale. “It might not be the right time for everyone, and that’s OK.”

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