Home delistings hit highest share since 2020 as sellers retreat

More U.S. homeowners are taking properties off the market as buyers resist prices and financing costs stay high. Redfin said 5.8% of active home listings were withdrawn in April, tying December for the largest share since March 2020, when the pandemic stalled housing activity.

The April delisting share rose 3.8% from March, according to Redfin. CNBC reported that the pullback came during the spring selling season, a period that typically draws more listings and buyer traffic.

Redfin attributed the increase to softer demand tied to higher mortgage rates, elevated gas prices and weaker consumer confidence. The brokerage said sellers have lost some pricing power as buyers press for concessions and walk away from homes they view as overpriced.

Atlanta recorded the highest withdrawal rate among the markets cited by Redfin, with about one in 10 listings taken off the market in April. San Jose, California, followed at roughly 9%, while Los Angeles and Dallas each had 7.8% of listings pulled and Seattle had 7.7%.

Mortgage rates had eased early in the year, with the 30-year fixed rate briefly moving into the 5% range at the end of February, according to Mortgage News Daily. CNBC reported that rates then climbed sharply after the war with Iran began and have stayed elevated.

Patricia Ammann, a Redfin agent, said in a company release that buyers are often using their leverage to offer below asking prices and insist on inspections, while some sellers are unwilling to lower expectations. That mismatch is pushing more owners to withdraw homes rather than accept lower bids, according to Redfin.

Home prices have cooled from earlier levels but remain above where they stood a year earlier, CNBC reported. Cotality chief economist Selma Hepp said in a release that markets more dependent on traditional mortgage borrowing and rate-sensitive buyers are seeing flatter price trends.

Hepp also said fewer markets posted annual price declines in April than in earlier months, which she described as a sign of stabilization in housing. The data point suggests the market is not weakening evenly across the country, even as some sellers struggle to close deals.

Pending sales of existing homes rose 1.4% in April from March, according to the National Association of Realtors. CNBC reported that the slight gain likely reflected a larger number of homes available for sale, with inventory up nearly 6% from March.

At the same time, listings are accumulating in some areas as new homes enter the market and older listings sit longer, according to CNBC. Longer selling times have led some buyers to step back as the spring season winds down.

Redfin also said some owners who withdrew homes over the past year returned to the market in April. Relisted homes accounted for 2.5% of all homes for sale that month, matching the prior two months for the highest share since mid-2020, when housing demand surged.

This story draws on original reporting from CNBC.