(NewsNation) — The U.S. housing market is starting to show signs of life with new listings climbing at their fastest rate in nearly three years.
During the four weeks ending March 17, new listings of U.S. homes for sale were up 15% compared to the same time a year ago, hitting 88,902, according to data from Redfin. That’s the sharpest spike since June 2021.
Redfin said the total number of active listings also increased at its strongest pace in nearly a year, rising 5% during the most recent four-week period.
The boost in supply will come as welcome news to prospective homebuyers who have grappled with elevated mortgage rates, higher prices and low inventory in recent years.
Although better than it has been, the current 3.4-month housing supply still favors sellers and is below the average supply of 4 to 5 months, according to Redfin.
Spring is an active time for home sales, and the pickup in inventory is starting to lure buyers off the sideline.
Last month, sales of existing homes surged 9.5% — the largest monthly increase since Feb. 2023 — the National Association of Realtors (NAR) said Thursday.
“Additional housing supply is helping to satisfy market demand,” NAR Chief Economist Lawrence Yun said in a release.
But with more people looking, prices have continued to rise. February’s median existing-home price was $384,500, up 5.7% from the prior, NAR found. In the West, $593,000 (+9.1%), and Northeast, $420,600 (+11.5%), the median home price rose even faster compared to a year ago.
“More supply is clearly needed to help stabilize home prices and get more Americans moving to their next residences,” Yun said.
Mortgage rates have also ticked up recently, dealing another blow to affordability. The average long-term U.S. mortgage rate climbed back to nearly 7% this week, according to mortgage buyer Freddie Mac.
Lower interest rates could be coming later this year, but for now, the Fed is holding off. With that said, the days of 3% to 4% mortgage rates are likely in the rearview mirror.
This week, Fannie Mae said it expects the 30-year fixed-rate mortgage to end 2024 at 6.4%, up from its 5.9% prediction earlier this year.
“While we don’t expect a dramatic surge in the supply of homes for sale, we do anticipate an increase in the level of market transactions relative to 2023 — even if mortgage rates remain elevated,” Doug Duncan, Fannie Mae’s chief economist, said in a statement.