The U.S. housing market is seeing an increase in supply, with five months of available inventory – the highest since early 2019. According to Redfin, new listings rose 7.4% year over year for the four weeks ending February 9, while pending home sales fell by 6%. The slowdown in sales is attributed to high home prices and mortgage rates.

The median home sale price increased by 4.3% year over year to $375,750, while the median asking price rose 5.4% to $409,563. The median monthly mortgage payment now sits at $2,753, just $46 below its all-time high. The average 30-year fixed mortgage rate was 6.89% for the week ending February 6, remaining significantly above pre-pandemic levels.

Despite the sluggish market, early indicators suggest buyer interest may be picking up. Redfin’s Homebuyer Demand Index, which tracks home tours and buying services, increased 3% from its six-month low in late January. Touring activity is also up 13% since the start of the year.

Some markets are seeing notable shifts. Pending sales in Los Angeles rose 3.4% year over year, marking the first increase after five weeks of declines. This uptick may be linked to homebuyers displaced by recent wildfires. Meanwhile, government-related uncertainties in Washington, D.C., and other federal employment hubs are impacting buyer and seller behavior, with some homeowners selling due to return-to-office mandates and job stability concerns.

With inventory growing and mortgage rates still high, the housing market remains in a state of adjustment, with buyers and sellers carefully weighing their options.