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Housing Market Update: Increased Inventory, Slower Sales Define End of 2024

Ridgewood Real estate

the staff of the Ridgewood blog

Ridgewood NJ, as we kick off 2025 , the housing market shows a mixed bag of news. While there’s a significant increase in available homes for sale, much of that inventory remains unsold, reflecting challenges for both buyers and sellers.

Housing Inventory Hits New Highs

According to a recent report by Redfin, active listings in November 2024 were 12.1% higher than the same month in 2023, marking the highest inventory levels since 2020. However, a staggering 54.5% of those homes sat on the market for at least 60 days, the highest share for any November since 2019.

The typical home that did sell took 43 days to go under contract, the slowest pace for November in five years.

“A lot of listings on the market are either stale or uninhabitable. There’s a lot of inventory, but it doesn’t feel like enough,” said Redfin agent Meme Loggins in the report.

Loggins added that pricing is crucial in the current market:

“Homes that are priced well and in good condition are flying off the market in three to five days, but overpriced homes can sit for over three months.”

Interest Rates and Rising Prices Challenge Buyers

Mortgage rates climbed above 7% in October and have largely remained elevated, according to Mortgage News Daily. At the same time, home prices continue to rise. The latest S&P CoreLogic Case-Shiller report showed national home prices up 3.6% in October year-over-year.

While some buyers are adjusting to this “new normal” of higher mortgage rates, affordability remains a significant barrier.

“The cost of owning a home now, when adjusted for inflation, is at its highest point in decades,” noted Selma Hepp, chief economist at CoreLogic.

Buyers’ Market or Sellers’ Market?

The market appears to be shifting. Pending home sales, a measure of signed contracts, rose in November, both month-over-month and year-over-year, reaching their highest level in nearly two years, according to the National Association of Realtors (NAR).

“Consumers appeared to have recalibrated expectations regarding mortgage rates and are taking advantage of more available inventory,” said Lawrence Yun, NAR’s chief economist.

However, renters are staying put longer, with fewer people making the leap into homeownership. Rising home prices, broker fees, and moving costs are keeping many renters on the sidelines.

Looking Ahead to 2025

While the additional inventory is a positive sign, the slow pace of sales and high costs pose challenges for the new year. The seller lock-in effect, where homeowners hesitate to sell due to low locked-in mortgage rates, has eased slightly in 2024, often driven by life events or the need to access home equity.

Yet, these factors haven’t significantly boosted sales as high prices and interest rates remain obstacles.

The housing market’s trajectory in 2025 will largely depend on interest rates, affordability, and continued shifts in buyer and seller behavior. For now, both buyers and sellers must navigate a complex and evolving landscape.

 

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3 thoughts on “Housing Market Update: Increased Inventory, Slower Sales Define End of 2024

  1. Ridgewood is so overpriced

    1. You can always stay in waldwick

      1. Agreed. Living in a welcoming community isn’t cheap.

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