US home turnover rate at lowest level in decades as housing slump drags on

The Decline in U.S. Home Turnover Rate

By ALEX VEIGA

LOS ANGELES (AP) — The U.S. housing market is experiencing a historic low in home turnover rate, with only 28 out of every 1,000 homes changing hands between January and September. This marks the lowest turnover rate in nearly three decades, according to an analysis by Redfin.

The decline in home turnover rate indicates that homeowners are staying put for longer periods. Factors contributing to this trend include limited job opportunities for relocation, affordability challenges in the current real estate market, and the impact of rising mortgage rates.

Chief economist at Redfin, Daryl Fairweather, expressed concerns about the implications of homeowners staying put for the economy. He noted that the slowdown in job growth, as evidenced by recent hiring data, is closely tied to the stagnant housing market.

Recent reports show a decrease in job additions by U.S. employers, with some major companies announcing layoffs. This uncertainty in the job market has led to increased concerns among Americans, further dampening the prospect of home sales.

Additionally, homeowners who secured low mortgage rates in previous years have little incentive to sell and purchase homes at current rates. The overall housing market has been sluggish since 2022, following a period of high demand fueled by historically low mortgage rates.

Although there was a slight uptick in home sales last month due to a decrease in mortgage rates, many Americans still struggle to afford homes amidst soaring prices. The median sales price of existing homes has surged by 53% over the past six years, making homeownership out of reach for many.

The combination of limited job mobility, affordability challenges, and economic uncertainties continues to impact the U.S. housing market, with implications for both homeowners and prospective buyers.