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Inventory down 40% from pre-COVID level as price growth intensifies

Inventory down 40% from pre-COVID level as price growth intensifies


SEATTLE, Jan. 20, 2022 /PRNewswire/ — The home shopping season appears to already be in full swing, as anxious buyers outnumbered dwindling new listings and drove inventory to record low levels in December. Limited supply is already pushing price growth up, as Zillow®’s latest market report1 shows monthly home value appreciation accelerated for the first time since July. 

In addition to not wanting to wade into such a tight market as a buyer, homeowners could be hesitant to list their houses and move due to a resurgence in coronavirus cases and employers’ rising uncertainty about post-pandemic working arrangements, according to a recent Zillow survey.   

“Home shoppers picked the shelves clean this December, leaving fewer active listings than ever before in the U.S. housing market,” said Jeff Tucker, senior economist at Zillow. “Enough determined buyers kept up their house hunt to reignite monthly price appreciation. Rising mortgage rates could be the next potential headwind, but demand has proven persistent; neither high prices nor slim inventories have deterred buyers so far.”

The typical home value is now $320,662, 19.6% above that of December 2020. The annual growth rate represents an all-time high in data dating back more than 20 years. After decelerating since July, month-over-month home value appreciation reignited, jumping from 1.2% in November to 1.4% in December.

The resurgent upward pressure on prices is likely due to astonishingly low levels of inventory this winter. After slipping in November, inventory plunged in December, dropping 11.1% in a month to a new record low of about 923,000 homes. Buyers shopping in December had 19.5% fewer homes to choose from than they did a year before, when inventory was already at a record low. Compared to December 2019, there are now 40.5% fewer homes available for sale.

One bright point for buyers is that the speed of the market has gradually slowed since the frenzied summer. In June, the typical U.S. home spent just one week on the market before going under contract. That has risen every month since, to roughly 13 days in December. This is still an incredibly short time on the market, but those extra few days do give buyers more time to assess their options. 

Surge in coronavirus cases could be hampering listings, plans to move
While December typically sees a sharp decline in newly listed inventory, the 18.9% monthly drop seen last month was the largest in the past three years. The rise of the omicron variant of coronavirus could be partially responsible, pushing homeowners to wait for infection rates to subside before listing. 

Workers are also less certain about their long-term working arrangements, which could impact their plans to move. A December survey2 conducted by Zillow found that 52% of workers reported that their employer had announced post-pandemic work arrangements — a lower share than was reported in June 2021. One possible explanation is that the rise of new coronavirus variants has caused employers to push back in-person start dates indefinitely.

Workers whose employer has announced post-pandemic work arrangements are more likely to say they are considering a move within the next three years: 51%, versus 41% for those whose employers have not lined out a plan. 

Rent growth slows
Typical rents rose a record 15.7% year over year in December, to $1,855 per month. However, monthly growth was 0.7% in December, the lowest monthly growth seen since February. 

Rents grew year over year in all 50 of the nation’s largest metros. Annual rent appreciation was fastest across the Sunbelt, led by Miami (29.6%), Tampa (28.6%), Phoenix (26.0%) and Las Vegas (25.1%). 

Metropolitan
Area*

Zillow
Home
Value Index
(ZHVI)

ZHVI –
Year-
over-
Year
Change

ZHVI –
Month-
over-
Month
Change

For-Sale
Inventory
Year-over-
Year
Change 

Median
Days to
Pending

Zillow
Observed
Rent Index
(ZORI)

ZORI –
Year-
over-
Year
Change

United States

$320,662

19.6%

1.4%

-19.5%

13

$1,855

15.7%

New York, NY

$573,813

12.5%

0.6%

-25.4%

37

$2,772

16.2%

Los AngelesLong Beach– Anaheim, CA

$868,350

17.9%

1.1%

-29.7%

13

$2,747

13.4%

Chicago, IL

$289,595

13.6%

0.9%

-22.8%

22

$1,735

10.4%

DallasFort Worth, TX

$344,919

25.2%

1.7%

-24.0%

17

$1,719

17.9%

Philadelphia, PA

$313,529

14.7%

0.7%

-9.3%

13

$1,740

11.4%

Houston, TX

$278,685

19.3%

1.2%

-17.5%

14

$1,519

11.9%

Washington, D.C.

$526,296

11.9%

0.6%

-4.4%

12

$2,119

11.7%

MiamiFort Lauderdale, FL

$397,603

22.3%

1.9%

-48.0%

18

$2,564

29.6%

Atlanta, GA

$338,243

27.4%

2.4%

-27.8%

10

$1,882

21.6%

Boston, MA

$612,114

14.3%

0.8%

-25.7%

10

$2,608

13.7%

San Francisco, CA

$1,374,739

17.3%

0.8%

-21.6%

13

$3,044

10.4%

Detroit, MI

$226,372

15.0%

0.7%

-4.8%

13

$1,384

11.0%

Riverside, CA

$534,393

26.2%

0.9%

-7.1%

14

$2,469

18.1%

Phoenix, AZ

$427,451

31.8%

1.4%

-9.5%

14

$1,858

26.0%

Seattle, WA

$718,944

22.2%

1.6%

-22.9%

6

$2,132

17.3%

MinneapolisSt. Paul, MN

$353,505

12.6%

0.8%

-6.0%

21

$1,610

5.6%

San Diego, CA

$834,199

23.6%

1.4%

-28.4%

9

$2,757

17.2%

St. Louis, MO

$224,320

14.1%

1.0%

-23.5%

8

$1,210

10.9%

Tampa, FL

$327,618

29.7%

1.7%

-24.7%

7

$1,985

28.6%

Baltimore, MD

$353,016

11.6%

0.6%

-9.6%

11

$1,793

12.1%

Denver, CO

$588,328

22.5%

1.6%

-40.3%

6

$1,873

14.8%

Pittsburgh, PA

$201,584

15.4%

0.7%

-7.8%

23

$1,289

7.8%

Portland, OR

$540,550

18.1%

0.9%

-14.7%

8

$1,810

12.8%

Charlotte, NC

$336,085

26.9%

1.8%

-23.6%

6

$1,704

19.5%

Sacramento, CA

$574,383

21.5%

0.6%

-30.5%

9

$2,195

13.0%

San Antonio, TX

$277,236

21.9%

1.8%

-28.6%

12

$1,392

15.7%

Orlando, FL

$340,123

23.5%

2.1%

-30.3%

8

$1,887

23.8%

Cincinnati, OH

$240,833

16.0%

0.9%

-12.6%

6

$1,401

10.2%

Cleveland, OH

$200,895

15.9%

0.7%

-33.5%

12

$1,209

9.7%

Kansas City, MO

$264,395

18.2%

1.2%

-7.6%

5

$1,258

9.9%

Las Vegas, NV

$395,943

26.8%

1.7%

-26.0%

10

$1,822

25.1%

Columbus, OH

$271,956

16.4%

1.2%

-7.6%

5

$1,350

10.7%

Indianapolis, IN

$244,052

19.3%

1.8%

-9.8%

5

$1,368

12.4%

San Jose, CA

$1,536,201

17.2%

1.4%

-31.4%

14

$3,007

9.2%

Austin, TX

$545,850

44.6%

2.2%

14.6%

21

$1,782

24.4%

Virginia Beach, VA

$301,273

14.7%

1.1%

-17.4%

22

$1,539

14.3%

Nashville, TN

$393,938

27.1%

2.8%

7

$1,788

18.9%

Providence, RI

$417,771

19.0%

1.0%

-31.6%

13

$1,739

12.6%

Milwaukee, WI

$250,900

13.0%

0.2%

36

$1,217

7.3%

Jacksonville, FL

$321,420

27.7%

2.1%

-21.9%

10

$1,718

24.0%

Memphis, TN

$209,211

19.5%

1.6%

-1.2%

20

$1,468

16.4%

Oklahoma City, OK

$198,154

15.7%

1.5%

-12.6%

7

$1,216

11.9%

LouisvilleJefferson County, KY

$224,727

14.1%

1.1%

-3.7%

9

$1,183

9.0%

Hartford, CT

$296,333

15.2%

0.6%

-32.9%

15

$1,583

10.5%

Richmond, VA

$305,227

14.4%

1.2%

-15.6%

6

$1,518

14.7%

New Orleans, LA

$254,376

14.4%

1.3%

-22.4%

9

$1,461

18.2%

Buffalo, NY

$226,354

19.1%

0.4%

-11.0%

12

$1,085

10.2%

Raleigh, NC

$399,332

30.7%

2.1%

-39.2%

5

$1,663

18.4%

Birmingham, AL

$219,531

16.9%

1.6%

-25.7%

6

$1,285

10.7%

Salt Lake City, UT

$553,658

27.6%

1.6%

-12.0%

8

$1,634

19.1%

*Table ordered by market size 

1  The Zillow Real Estate Market Report is a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Research. For more information, visit www.zillow.com/research. The data in the Zillow Real Estate Market Report is aggregated from public sources by a number of data providers for 928 metropolitan and micropolitan areas, dating back to 2000. Mortgage and home loan data is typically recorded in each county and publicly available through a county recorder’s office. All current monthly data at the national, state, metro, city, ZIP code and neighborhood levels can be accessed at www.zillow.com/research/data.
2  Zillow Group conducted a nationally representative survey of U.S. adults in mid-December 2021 and asked 824 adults about their plans to move, their view of current housing prices and their anticipated work arrangements.

About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make it easier to unlock life’s next chapter. As the most visited real estate website in the United States, Zillow® and its affiliates offer customers an on-demand experience for selling, buying, renting or financing with transparency and ease. 

Zillow Group’s affiliates and subsidiaries include Zillow®, Zillow Offers®, Zillow Premier Agent®, Zillow Home Loans™, Zillow Closing Services™, Zillow Homes, Inc., Trulia®, Out East®, ShowingTime®, Bridge Interactive®, dotloop®, StreetEasy® and HotPads®. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). 

 

SOURCE Zillow





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