Weak buyer demand, weakening home prices, and general uncertainty in the economy are combining to cause home sellers to change their minds and leave the market.
Nearly 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 many listings are becoming stale and staying on the market longer and longer. Redfin reported that 70% of listings in September were on the market for 60 days or more.
Homeowners are seeing prices weaken significantly and are choosing to wait rather than accept a low offer. Prices in September rose 1.3% year over year, up from a 1.4% increase in August, according to S&P Cotality’s NSA Case-Shiller U.S. National Home Price Index.
“The frequency of delistings keeps inventory tighter than it appears on paper,” said Asad Khan, senior economist at Redfin. “When tens of thousands of homeowners take their homes off the market rather than accept a low offer, it effectively reduces the supply of homes that are actually available to buyers. That keeps sales prices high.”
Some sellers are lowering prices, even several times. The typical price cut is about $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 real estate 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 until 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 recent years are facing potential losses. About 15% of 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 is likely to slow in the coming weeks, both due to the season and weakening consumer confidence among buyers and sellers alike.
Pending sales in October, which are based on signed contracts, rose 1.9% month over month and were basically flat from a year earlier, according to real estate agents. The monthly increase may have been due to a small drop in mortgage rates, which then rose again in November.
