The current housing market bifurcation, as told by one metric

The typical home listed for sale in the Rochester, NY metro area goes pending in 11 days, compared to 105 days in the Asheville, NC metro area.

[Map: Lance Lambert, created with Datawrapper; image: Adobe Stock]

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One of the ways I’ve been tracking shifts in the supply-demand equilibrium of local housing markets for years is by monitoring changes in active inventory/months of supply. If active listings begin to rise rapidly while homes remain on the market longer, it may indicate pricing softness or weakness. Conversely, a sharp decline in active listings/months of supply could suggest a market that is heating/tightening up.

Since the national Pandemic Housing Boom fizzled out and mortgage rates spiked in summer 2022, directionally, that supply-demand equilibrium has been shifting in the favor of buyers. Indeed, while decelerating, national active inventory for sale is still up +8.1% year-over-year—and now active inventory for sale is only -13.6% below pre-pandemic 2019 levels.

Broadly speaking, the reason isn’t that there are significantly more new listings. Instead, it’s that, relatively speaking, sellers in the post-Pandemic Housing Boom period are finding more resistance. As a result, homes are spending more time on the market and are therefore being counted as inventory for longer.

How long the typical U.S. home listed for sale on Zillow.com before it went pending:

Spring 2019 —> 41 days

Spring 2020 —> 36 days

Spring 2021 —> 14 days

Spring 2022 —> 10 days

Spring 2023 —> 26 days

Spring 2024 —> 25 days

Spring 2025 —> 33 days

Spring 2026 —> 39 days

Active housing inventory for sale = All properties for sale in a given month, excluding pending listings. If homes take longer to sell, and begin to rollover into the next month, it begins to build active inventory for sale even if new listings coming onto the market don’t spike. That’s exactly what many housing markets have been experiencing.

In other words, it’s no coincidence that both the national median days to pending and the national active housing inventory for sale are just about back to pre-pandemic 2019 levels—to a degree, they’re interconnected.

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