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Housing inventory is rising across the vast majority of the country—just take a look at this map

Regionally speaking, the year-over-year inventory shift varies a lot.

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As ResiClub reported last week, the number of active U.S. homes for sale in March 2024 (694,820) is up +24% on a year-over-year basis from March 2023 (562,444 active listings).

Regionally speaking, the year-over-year state shift varies a lot. [For county level data, ResiClub PRO members can access it here]

In Nevada, active listings are down -26% on a year-over-year basis as markets like Reno and Las Vegas tightened up following a brief home price correction in the second half of 2022.

Meanwhile, active listings are up +57% in Florida on a year-over-year basis, as Southwest Florida markets like Cape Coral and Punta Gorda continue to soften.

Click here to view an interactive version of the map below

If active listings begin to rise quickly as homes sit on the market longer, in theory, it can signal a weakening market. If active listings begin to fall quickly as homes sell faster, in theory, it can signal a strengthening housing market.

Big picture: We're observing some softening across many housing markets as higher mortgage rates temper the fervor of a market that was unsustainably hot during the Pandemic Housing Boom.

That said… most of the country still remains below pre-pandemic inventory/months of supply. Much of the Midwest/Northeast, in particular, remains tight.

National active listings in March 2024 (694,820) on Realtor.com were -37.7% below March 2019 levels when there were 1,115,940 U.S. homes for sale. That lack of inventory explains why home prices in many markets, despite softening and spiked interest rates, have remained resilient.

Click here to view an interactive version of the map below

Last month, ResiClub PRO members got two deep dives looking into why Florida’s housing market is softening faster than the national market.

While inventory levels in Florida are up the most in the nation on a year-over-year basis (+57%), the bulk of the increase is really concentrated in sections of Southwest Florida. In particular, in markets like Cape Coral and Fort Myers, which were hard-hit by Hurricane Ian in September 2022.

Hurricane Ian left behind thousands of damaged homes, and the subsequent need for renovations has resulted in a surge in available inventory. According to the National Oceanic and Atmospheric Administration, Hurricane Ian caused an estimated $112.9 billion worth of total damage, making Ian the third-costliest U.S. hurricane on record.

In addition to residential property damage, the hurricane has also coincided with spiked home insurance costs. This combination of increased housing supply for sale—the damaged homes—coupled with strained demand—the result of spiked home prices, spiked mortgage rates, higher insurance premiums, and higher HOAs—has translated into market softening across much of Southwest Florida.

Click here to view an interactive/zoomable version of the map below

While active inventory in areas like Fort Myers and Cape Coral are back above pre-pandemic inventory levels, many areas of Florida, like Miami, are still below pre-pandemic inventory levels.

Click here to view an interactive/zoomable version of the map below

If inventory continues to mount, could more parts of Southwest Florida see home price declines?

Presumably, yes.

If housing affordability remains constrained and active listings/months of supply continue to spike in parts of Southwest Florida, prices could soften/further soften.

JPMorgan CEO Jamie Dimon

Jamie Dimon argues that U.S. housing market affordability can be improved by reforming "mortgage regulations"

This week, JPMorgan CEO Jamie Dimon published his annual shareholder letter where he made the case that housing affordability could be improved if appropriate reforms were made to mortgage regulations.

Dimon wrote: “We can fix the housing and mortgage markets. For example, mortgage regulations around origination, servicing and securitization could be simplified, without increasing risk, in a way that would reduce the average mortgage by 70 or 80 basis points. The Urban Institute estimates that a reduction like this would increase mortgage originations by 1 million per year and help lower-income households, in particular, buy their first home, thereby starting them on the best way to build household net worth.”

In the letter, Dimon didn't get into the nitty-gritty details of what exact mortgage reforms he'd like to see. Tomorrow, ResiClub will try to track down that Urban Institute study he mentioned.