Key Details:
- Zillow’s October Market Report reveals a shift toward a buyer’s market in 13 major metros, including Pittsburgh, Louisville, and Atlanta, driven by inventory recovery and reduced competition.
- Nationwide inventory is 28% below pre-pandemic levels, marking the smallest shortfall since 2020.
- Zillow’s data highlights how mortgage trends, home value changes, and new construction are shaping today’s housing market.
Buyer’s markets are spreading from the South as housing inventory recovers, reducing competition and softening home price growth.
That’s according to Zillow’s October Market Report, released this week.
Home buyers in 13 major U.S. metros are gaining leverage as supply growth impacts home prices and days on market. While 11 metros on the list had previously entered into a buyer’s market, two new additions—Pittsburgh and Louisville—bring the tally to 13.
“We’re seeing competition among buyers fade, with mortgage rates climbing back toward 7% as we move closer to the usual winter slowdown. Inventory is still slowly building back up and price cuts are still relatively common — persistent buyers may be able to find a deal or negotiate for worthwhile concessions.”
Source: Zillow
Market Trends: Shifting Towards Buyers
Judging by Zillow’s market heat index, competition nationwide is getting closer to a buyer’s market. And while most metros classified as such are in the South, markets further north have started leaning in that direction.
Zillow’s research indicates 13 major U.S. metros are buyer’s markets. In no particular order, they include:
- Pittsburg, PA (new addition)
- Louisville, KY (new addition)
- Indianapolis, IN
- Nashville, TN
- Atlanta, GA
- Tampa, FL
- Orlando, FL
- Miami, FL
- Jacksonville, FL
- San Antonio, TX
- Austin, TX
- Memphis, TN
- New Orleans, LA
Inventory recovery in these markets has slowed home value appreciation and reduced competition for available listings.
Inventory Recovery
Housing inventory is 28% below pre-pandemic numbers for this time of year—the smallest shortfall since September 2020. The shrinking deficit indicates significant progress from March 2024’s deficit of 36%.
Southern metros—specifically those in Texas, Florida, and New Orleans—have seen prominent supply recovery, leading the nation in tipping the scales in favor of buyers.
The 13 buyer’s markets in Zillow’s report have an edge rank among the top 20 markets when it comes to supply growth, with many of the 13 seeing stronger growth in new construction activity and flattened growth in both rents and home prices.
Based on Zillow’s data for October, new listings are down 1.6% month over month but up 2% year over year. Compared to pre-pandemic levels, new listings are down 17.7%, reversing some of the progress made in September.
Total inventory (active listings) for October fell slightly by 0.05% month over month but were up 18.5% compared to a year ago (October 2023). Inventory levels are down 27.9% from pre-pandemic levels, continuing the market’s progress toward reducing the pandemic-era deficit.
Home Values and Market Activity
Month over month, home values dropped in 47 major U.S. metros. Those with the biggest monthly declines included:
- Austin (-1%)
- Tampa (-0.7%)
- San Antonio (-0.7%)
- Dallas (-0.7%)
- Atlanta (-0.7%)
Southern markets are also seeing the biggest increases in median days on market compared to pre-pandemic levels.
Only one of the 50 largest metro areas saw home values increase month over month: New York City, with a 0.1% uptick. Home values were neutral in Salt Lake City and Washington, D.C..
Home value declines were smallest in Las Vegas (-0.1%) and Louisville (-0.1%).
Year over year, home values were up in 42 of the 50 largest metro areas. Metros with the largest annual price gains included:
- San Jose (7.1%)
- New York City (7%)
- Hartford (7%)
- Providence (6.8%)
- Cleveland (5.7%)
Home values were down from year-ago levels in seven major metro areas.
Metros with the largest annual declines:
- Austin (-3.5%)
- New Orleans (-3.2%)
- San Antonio (-2.5%)
- Tampa (-1.2%)
- Jacksonville (-0.4%)
Mortgage Trends and Affordability
September’s dip in mortgage rates provided a brief respite for buyers priced out of the market. Rates climbed back up in October, and mortgage payments on a typical home rose 2.8% month-over-month after falling for four months straight.
Based on a 20% down payment, monthly mortgage payments are now down more than $100 a month compared to May’s peak and $179 less than they were in October 2023.
Mortgage rates are still around 7%, influencing affordability and buyer activity.
Regional Differences
Seasonal housing supply trends vary from one region to the next, with Southern states seeing less of an impact from winter weather. As a result, inventory recovery has been especially robust in the South and particularly in select Texas, Florida and New Orleans metros.
Read the full report for more information, including metro-level data and methodology.
