The home buying boom of late 2020 and 2021 depleted already low home inventory levels, and, as current homeowners are locked in to lower rates from that period, fewer homes are turning over to new owners this year. For the first half of 2023, 14 of every 1,000 homes have changed hands, according to a new report from Redfin.
Down from 19 of every 1,000 homes during the first half of 2019, the turnover rate is the lowest it’s been in at least a decade. Turnover is even lower in the suburbs with 16 of every 1,000 large suburban houses changing hands in the first half of the year.
Over the last four years, the turnover rate has fallen for every size and neighborhood type, but smaller homes in both cities and suburbs are the most difficult to find, according to the report. Eleven of every 1,000 two- and three-bedroom urban and suburban houses sold in the first half of 2023.
In San Jose, California, home buyers have fewer options with only six of every 1,000 homes having changed hands so far this year, which is the lowest rate of the 50 most populous metros. All with about eight of every 1,000 homes sold, California’s Oakland, San Diego, Los Angeles, Sacramento, and Anaheim follow behind San Jose.
In contrast, the largest pool of options for home buyers is found in Newark, New Jersey, with 24 of every 1,000 homes changing hands for the first half of the year. Nashville, Tennessee, and Austin, Texas, follow closely with 23 and 22 of every 1,000 homes, respectively. The two metros, along with Fort Worth, Texas, also have the highest large suburban, single-family home turnover.
Nashville and Austin are also two of five metros with the smallest declines in turnover since 2019 and have the second and third smallest declines for large suburban houses. The report cites new construction in the two metros as a contributor to the healthy turnover rates with inventory of single-family homes for sale being made up of more than 30% newly built homes in both metros.
