Buyers are finding slightly more selection, more price cuts and a bit more time to evaluate a home before it goes under contract, according to the latest market from Zillow. The company said the modest calming of the market that began late in the summer has continued into early fall.
“The housing market continued its gradual return to some semblance of normalcy in September, helped by the typical seasonal cooldown in shopping conditions that we expect to see every fall,” said Jeff Tucker, senior economist at Zillow. “Homes are still selling quickly, and prices have not receded, but it’s not quite as extreme a sellers’ market as we saw back in the spring and summer. Buyers today will benefit from a little more time to pick the right home and a few more listings to choose from.”
The Zillow Home Value Index (ZHVI) for the U.S. rose to $308,220 in September, up 1.6% from August. That’s the second straight slowdown after monthly appreciation peaked this year at 2% in July. Monthly home value appreciation slowed from August in 44 of the 50 largest U.S. metros.
Despite the modest cooling, September marked the fourth-fastest monthly pace of appreciation and a record pace of yearly appreciation in Zillow data dating back to 2000. The typical U.S. home was worth 18.4% more in September 2021 than it was in September 2020, surpassing August’s then-record of 17.5% year-over-year appreciation.
The inventory shortage remains acute in much of the country, down 19.9% from this time a year ago and 37.7% below 2019 levels. However, slow, incremental growth in inventory is helping shift the scales ever so slightly in buyers’ favor after hitting an all-time low in April.
This small sign of relief for buyers is showing itself in the gradually slowing of market velocity. Homes are taking one day longer to sell than in August, with listings going into the pending stage in a median of just nine days, giving buyers a bit more time to find the homes they’re looking for.