Weak buyer demand, weakening home prices and overall uncertainty in the economy are combining to make home sellers change their minds and step out of the market.
Close to 85,000 U.S. sellers took their homes off the market in September, up 28% from September 2024 and the highest level for that month in eight years, according to Redfin.
Sellers are delisting because so many listings are going stale, sitting on the market longer and longer. Redfin reported that 70% of listings in September were on the market for 60 days or longer.
Homeowners are seeing prices weaken significantly and would rather wait than accept a low offer. Prices in September were 1.3% higher year over year, down from a 1.4% rise in August, according to the S&P Cotality Case-Shiller U.S. National Home Price NSA Index.
“The frequency of delistings is keeping inventory tighter than it looks on paper,” said Asad Khan, a senior economist at Redfin. “When tens of thousands of homeowners pull their homes off the market rather than accept a low offer, it effectively reduces the supply of homes that are actually available for buyers. That keeps sale prices elevated.”
Some sellers are lowering prices — even multiple times. The typical price cut is roughly $10,000, but multiple reductions are becoming more common as homes take longer to sell, according to Zillow. The typical listing saw $25,000 in cumulative price cuts in October, matching the largest discounts Zillow has ever recorded.
The housing market is now heading into its slowest season. While 1 in 5 homes that are delisted are relisted, that may not happen for several months, as sellers will likely wait for the much busier spring season to try again.
Home prices are still 50% higher than they were just five years ago, but some sellers who bought in the last few years are facing potential losses. Roughly 15% of the homes that were delisted in September were at risk of selling at a loss, the highest share in five years, according to Redfin.
The supply of homes for sale is about 15% higher now than it was a year ago, according to Realtor.com, but that is likely to shrink in the coming weeks, both because of the season and because of weakening consumer sentiment among buyers and sellers alike.
Pending sales in October, which are based on signed contracts, were up 1.9% month to month and basically flat from a year ago, according to the Realtors. The monthly bump may have been due to a small drop in mortgage rates, which then turned higher again in November.
