The latest housing market data for June 2024 reveals significant trends that could reshape buyer and seller strategies. As the market adjusts, nearly one in four sellers have reduced home prices to attract buyers who remain cautious.

Inventory Surge and Price Adjustments

Throughout the year, the number of homes available for sale has steadily increased. From May to June, inventory rose by 4%, resulting in a 23% increase compared to last year's low levels. Despite this rise, the current inventory still lags 33% behind pre-pandemic averages. However, this is the smallest deficit observed since fall 2020.

This surge in listings has put pressure on sellers, particularly those with homes that aren't competitively priced or effectively marketed. According to Zillow's Chief Economist Skylar Olsen, sellers are now more frequently cutting prices to attract buyers who are facing affordability challenges. This shift marks a departure from the fast-paced, low-inventory market conditions that have defined the past few years, moving towards a more balanced competitive environment reminiscent of the pre-pandemic era.

Regional Inventory Variations

The increase in inventory isn't uniform across the country. Among the 50 largest U.S. metropolitan areas, all but New York and Cleveland have seen a rise in available homes compared to last year. On a month-over-month basis, only five of these metropolitan areas did not experience an increase in inventory.

While desirable properties continue to sell quickly, the overall market pace has slowed slightly. In June, homes typically stayed on the market for 15 days before receiving an offer, which is five days shorter than the pre-pandemic average but the smallest gap observed since June 2020.

Affordability Challenges

Despite the increase in listings, affordability remains a significant hurdle for buyers. Home prices have outpaced wage growth, limiting the ability of median-income households to afford mortgage payments in most major markets. Currently, only 11 out of 50 major markets are accessible to median-income families when considering a 20% down payment.

Home Value Trends

For homeowners, Zillow's report highlights a moderate annual home value appreciation of 3.2% nationally, a decrease from the 4.6% peak seen in March 2024. The monthly growth rate has also slowed to 0.6%, marking the slowest June appreciation since 2011.

Looking ahead, the cooling of home value growth could provide a window of opportunity for buyers to save and prepare for future purchases. Zillow predicts a modest 1% rise in home values nationally through June 2025, suggesting a period of stability and potential affordability improvements for buyers.

As the market continues to evolve, both buyers and sellers will need to adapt their strategies to navigate these changing conditions effectively.

‍