MINT HILL, NC – In April 2023, just shy of 400K homes were listed across the United States. That’s down more than 100K homes compared to April 2022, which was a time that was already known for tight home supply.
When you compared this to April of 2019, you get a better look at how tight the supply is right now. April 2019 saw just over 550K homes listed for sale.
The Chief Economist at Redfin, Daryl Fairweather, tweeted, “Homeowners are quiet quitting the housing market.”
While this is a bit of a sarcastic way to put it, there is truth in this tweet.
What is Quiet Quitting?
If you’re confused by this new phrase, you’re not alone. The phrase quiet quitting actually has nothing to do with the real estate market. It is a newer phrase used to refer to employees that will only do the minimum amount of work to keep their job and get paid.
In the tweet from Fairweather, the phrase is being used to describe potential homebuyers that are deciding they are no longer going to look for a home to buy. This is likely due to the spike in mortgage rates that has caused both buyers and sellers to take a step back.
Right now, there are many homeowners with mortgage rates at 2%, 3%, or even 4%. If they were to list their current home for sale, it would mean buying another home at a higher mortgage rate. For many, this just doesn’t make financial sense, especially with another rate increase and current mortgage rates around 6.9%, on average.
Both first-time buyers and move-up buyers are impacted greatly by the higher mortgage rates. For first-time buyers, it’s harder to get pre-approved for an amount that can land them the home they want. Move-up buyers have to give up a lower mortgage rate to sell and buy another home.
Both Supply & Demand Impacted
While the pullback is certainly impacting the supply side as inventory numbers are very low, it’s also impacting the demand side. Every time a would-be move-up buyer decides to stay put, it’s one less home for sale and one less buyer looking.
Pair this with many first-time buyers getting priced out of the market and it’s led to where we are today. April 2023 saw 21.2% fewer homes go up for sale, which compared to April 2022 when 49.3% more homes were available, shows the bigger issue.
As Fairweather stated, homeowners really are quiet quitting the housing market as they aren’t listing their homes. Plus, the mortgage rate spikes of last summer saw more homes staying on the market longer, which is a trend that has continued in some areas.
While the national real estate market is rather unique right now, your local market might not be. Just because homeowners are quiet quitting nationally, doesn’t mean that rings true locally. Make sure you look at where you want to buy or sell to make your decision.
I would love to be part of your journey when the time is right for you. If you ever have a real estate question or need, or know someone who does, trust that you can turn to me. I will help you make the right move! Anna Granger (704) 650-5707 | email@example.com | www.1stchoicepropertiesinc.com