The U.S. housing market has reached a rare and potentially dangerous imbalance. As of April, sellers outnumbered prospective homebuyers by nearly 500,000, according to a new analysis by Redfin. This marks the largest gap between the two groups since Redfin began tracking such data in 2013, signaling a potential turning point in the real estate market that could have wide-reaching consequences.
The Numbers Behind the Imbalance
Redfin’s data shows that there were about 1.9 million home sellers in April compared to 1.5 million active buyers. That’s a difference of 490,041 fewer buyers than sellers. Just a year ago, sellers only outnumbered buyers by 6.5%. Two years ago, the situation was reversed, with buyers outnumbering sellers by 5.3%.
This surge in sellers began in November 2023 when mortgage rates hit a 23-year high of nearly 8%. Although rates have eased slightly, with the average 30-year fixed mortgage now at 6.89%, they remain a barrier for many potential buyers.
Asad Khan, a senior economist at Redfin, noted, “The balance of power in the U.S. housing market has shifted toward buyers, but a lot of sellers have yet to see or accept the writing on the wall.”
What’s Driving the Trend?
Several factors have contributed to this imbalance. Elevated mortgage rates are making monthly payments too steep for many Americans. Even though the median home sales price rose 1.8% year-over-year in April to a record $414,000, affordability is still slipping further out of reach. According to the National Association of Realtors (NAR), only 21.2% of homes on the market were considered affordable for households earning $75,000 a year—down from nearly half before the pandemic.
Adding to this challenge is a growing sense of economic unease. A recent survey from Bank of America found that 75% of prospective buyers are waiting for both home prices and interest rates to drop before they’re willing to make a move. In the words of Karen Pohl, a real estate agent in Las Vegas, “I think there are a lot of sellers who still have really ambitious pricing for their homes, and it may be time to get realistic with their pricing in order to be competitive.”
What This Means for the Housing Market
The sudden shift to more sellers than buyers is expected to pull U.S. home prices down by about 1% by the end of the year, according to Redfin’s head of economics research, Chen Zhao. While that may not sound dramatic, it represents a major break from the relentless climb of home prices over the past several years.
Zhao explained, “Generally, the ratio of sellers to buyers seems to be a predictor for home price growth, but with a lag of about three to six months.” She also cautioned that larger drops in home prices are unlikely because “it’s actually very hard for home prices to fall, unless sellers have to sell.”
The Optimists and the Pessimists
Optimists see a silver lining for prospective homebuyers. In Los Angeles, for example, where sellers outnumber buyers by about 45%, real estate agent Jennie Izumi says the market is finally tipping in favor of buyers who have been shut out for years. “We’re finally getting inventory,” she said. “I was thinking buyers are going to come in and we’re going to start really moving, but it hasn’t happened.”
On the other side, pessimists warn that this imbalance may be a sign of a broader slowdown in the housing market that could ultimately drag down the economy. The surge in listings is the largest since March 2020, while buyer interest is at its lowest since the start of the pandemic—except for that initial lockdown freeze in April 2020.
This shift has already been felt in some areas. In the four weeks ending April 20, home prices fell in 11 of the 50 largest metro areas, including Dallas, Oakland and Jacksonville. In Miami, sellers outnumber buyers by a stunning 3 to 1, while Newark, New Jersey, remains one of the few markets where buyers still outnumber sellers.
Looking Ahead: A Market in Transition
For many, the mismatch between buyers and sellers is a warning that the red-hot housing market of the past decade is finally due for a correction. While the 1% expected drop in home prices is modest, it’s a clear signal that the market is no longer as invincible as it once seemed.
Some sellers have already begun to offer concessions like paying for buyers’ closing costs or reducing prices outright—something that was virtually unheard of just a couple of years ago.
In the end, this growing imbalance may be the first real test of how far the housing market can bend before it breaks. For now, both buyers and sellers are feeling the strain, and the coming months will show whether this is a temporary adjustment or the start of a more serious correction.
