US Home Sellers Slash Asking Prices as Housing Weakness Deepens

US home sellers are capitulating on price. Fresh Realtor.com data shows asking prices fell at the fastest annual pace in at least nine years in June, as elevated mortgage rates keep buyers on the sidelines and force sellers to reset expectations.

Record annual price drop

Home asking prices fell 2.5 percent year over year in June to a national median of $430,000, the steepest annual decline in Realtor.com’s data history, which dates to 2017, and the eighth consecutive month of decreases.

The median home spent 53 days on market, flat year over year, ending a 26-month streak of homes taking longer to sell than the prior year. Translation: the bleeding in time-on-market has stopped, but only because sellers are meeting buyers on price.

Why the market cracked

Persistently elevated mortgage rates have continued to weigh on affordability, limiting buyer purchasing power and reducing the urgency that fueled bidding wars during the pandemic housing boom.

A new report from Realtor.com found that the average home is now selling below its asking price, marking a significant shift from the pandemic-era housing market when bidding wars routinely pushed sale prices above list price. As one Realtor.com economist put it, the pandemic gave sellers a free pass on pricing, and that pass has expired.

Do you want to see how to make more plays? Do you want to find gains yourself?

Unusual Whales helps you find market opportunities through our market tide, historical options flow, GEX, and much, much more.

Create a free account here to start conquering the market with Unusual Whales.

A two-speed market

The housing market has become far more divided: In some parts of the country, sellers still hold all the power. In others, buyers are finally gaining leverage.

Parts of Florida, Texas and other Sun Belt markets that once saw pandemic-era demand spikes are now tilting toward buyers as inventory rises and demand cools. The Northeast and parts of the Midwest remain tighter, keeping the national picture uneven.

Sellers are also showing up

Sellers have also increasingly moved off the sidelines amid the price declines in a sign of confidence that they’ll find a willing buyer, as new listings increased 2.4% from a year ago.

More supply plus stretched affordability is the kind of setup that keeps a lid on price appreciation, and pressures builder margins as incentives ramp up.

Options market and stocks to watch

The housing complex is directly in the line of fire if weakness deepens. A few names traders may want to keep tabs on:

• DHI: D.R. Horton, the largest US homebuilder, is highly exposed to Sun Belt softness and incentive spending. Watch for margin commentary and order trends.
• LEN: Lennar has leaned heavily on rate buydowns to move inventory. Watch for how aggressive incentives get if pricing keeps sliding.
• PHM: PulteGroup skews to move-up and active-adult buyers, which can be more resilient, but not immune. Watch order growth vs. pricing power.
• Z: Zillow benefits from listings volume even in a soft market, but a slower transaction environment weighs on revenue mix.
• RKT: Rocket Companies is a direct read on mortgage origination volume. Watch for any refi pickup if rates ease.

Want more market intelligence? Create your free Unusual Whales account for options flow, market tide, GEX, and the full toolkit.