More Bay Area Homes Are Coming onto the Market in Summer 2021

In a July 3rd blog post, we explained that there have been more homes coming onto the real estate market in the San Francisco Bay Area. That was based on data provided by Realtor.com.

The group’s latest housing market update showed that even more homes are coming onto the market in the Bay Area. Specifically, we are seeing a continued rise in the number of new listings. These are properties that have come onto the real estate market in recent weeks (as opposed to older listings).

While overall housing market inventory in the Bay Area is still lower than last year, the deficit continues to shrink. This is mostly good news for home buyers, and it could make it easier to buy a house in the Bay Area later this year and in 2022.

Report: More ‘New Listings’ in the Bay Area

On August 10, Realtor.com published its latest housing market update with data for the country as a whole and the 50 largest metro areas. Among other things, their report showed that there are more homes coming onto the market in summer 2021.

In the San Francisco-Oakland-Hayward metropolitan area, new real estate listings rose by 5.1% in July compared to a year earlier. That might not seem like a very big number, but it comes on the heels of an even bigger increase reported during the previous month.

This shows that the San Francisco Bay Area real estate market is starting to gain more inventory.

Realtor.com’s report also pointed out that there are quite a few smaller homes coming onto the market. In this context, “smaller” refers to properties between 750 and 1,750 square feet. Nationwide, the market share of smaller homes increased from 30% last July to 36% in July 2021.

The report didn’t break down this particular metric by metro area. But it’s safe to assume that the Bay Area real estate market is also seeing an increase in the number of smaller properties for sale.

Total Inventory Is Still down, but Improving

While we are seeing more homes come onto the market in the Bay Area, total housing market inventory is still lower today than a year ago. But the deficit continues to shrink from one month to the next, another positive trend for home buyers.

As of July 2021, total real estate listings were down by -20.6% compared to a year earlier. That’s a smaller deficit than previous months. In other words, the rate of inventory decline continues to slow, as more homes come onto the market. Hopefully, that deficit will continue to shrink going forward.

A More ‘Buyer-Friendly’ Housing Market?

Danielle Hale, Chief Economist for Realtor.com, pointed out that the real estate market is slowly but surely becoming more buyer-friendly.

As she stated in the company’s August 2021 report:

new listings grew at an unusually high rate for the summer months, further helping the inventory crunch. This is shifting the housing market balance in a more buyer-friendly direction…

Like many cities and metropolitan areas, the Bay Area real estate market has cooled down a bit in recent months. It’s not quite as frenzied as it was six months ago. Additionally, home buyers can benefit from the ongoing increase in new listings across the region.

But make no mistake – the Bay Area real estate market still favors sellers over buyers due to the ongoing supply shortage. Even so, things are starting to look up, at least on the inventory side of things.

As more and more homes come onto the market, Bay Area buyers should have an easier time finding a suitable property within their budgets. And wouldn’t that be a refreshing change of pace?

This is a trend that could carry over into 2022 as well. In fact, it might be a bit easier to buy a home in the San Francisco Bay Area next year than it is right now. Especially if inventory levels continue to climb.

But home prices will likely continue to rise as well. So there is still a sense of urgency from a buyer’s perspective. Those who wait until 2022 to buy a house in the Bay Area might have more properties to choose from. But they will likely pay higher prices as well, based on current real estate trends.