More Homes for Sale? That’s Your Window of Opportunity

You may have heard that the number of homes for sale just hit a recent high — and that might have you wondering if we’re headed for another housing market crash.

But the truth is, the numbers tell a different story. In most markets, rising inventory isn’t a red flag — it’s a sign of a healthier, more balanced market.

So, what’s happening with inventory right now?

According to the latest data from Realtor.com, the number of homes for sale has climbed to its highest level since 2020 (see the white line in the graph below). But it’s important to note: we’re still not back to the pre-pandemic inventory levels, which are shown in gray.

There are more homes for sale today than we've seen in recent years — and that’s catching people’s attention. Yes, inventory is up compared to the past few years, but it’s still well below what we’d consider normal. And that context matters.

Why Rising Inventory Isn’t a Red Flag

When people hear “inventory is rising,” some immediately think back to 2008, when a flood of listings preceded the crash. But what’s happening today is completely different.

The critical difference? We’re not facing an oversupply — we’re still dealing with a long-term undersupply. For years, the pace of new home construction hasn’t kept up with demand. The red bars in the graph below highlight how far behind we’ve fallen since 2012 — the deeper the bars, the larger the gap between new homes built and households formed.

According to Realtor.com, at today’s construction rate, it would take 7.5 years to close that gap. That’s millions of homes the market is still short.

So no, rising inventory doesn’t signal trouble. In fact, it’s a step toward balance. Most markets need more homes — not fewer — and the current increase in listings is helping to meet that need, not exceed it.

Bottom Line

Don’t let the headlines throw you off. More homes hitting the market doesn’t mean we’re headed for a crash — far from it. It’s actually a positive sign that the housing market is slowly returning to a more balanced, sustainable place. Rising inventory gives buyers more options and helps ease the intense competition we’ve seen in recent years. In many ways, it’s exactly what the market needs right now.