As of mid-October, nearly half of all homes listed have been on the market for an average of 54 days, and at this rate, Zillow expects that average to hit 68 days by the end of 2022—10 days higher than last year. But these predictions are still lower than they were prior to the pandemic, indicating there is still some market competition. During the pandemic, competition was rampant, as homes sold at record speeds, but now the market is slowing down and homeowners are increasingly opting to keep their homes instead of putting them up for sale.
Slowdowns in both the supply and demand for homes have helped push Days on Zillow higher. Many would-be home sellers are holding onto their existing homes rather than listing them for sale, likely as a result of increasing interest rates, at least in part. When mortgage rates started rising this spring, the flow of new listings slowed from previous years’ trends. Through September, 7% fewer for-sale listings have entered the market in 2022 compared to the same period in 2021. With fewer homes entering the for-sale market, existing for-sale inventory represents a larger share of overall inventory, leaving Days on Zillow to naturally increase as these for-sale listings age. As a result, the share of inventory taken up by listings that have been on the market for seven days or fewer is down 42% compared to last year. With interest rates appearing likely to stay high for the time being, this dynamic will probably persist.