Housing inventory reached its highest level since the pandemic in July, according to Realtor.com’s July Monthly Housing Markets Trends Report. 

The combination of rising inventory and price reductions is delivering a market that’s more buyer friendly for homebuyers. 

The number of homes for sale increased by 36.6% in July compared to the same month last year, reaching a post-pandemic high. Buyers also benefited from price reductions, with 18.9% of listings experiencing cuts — the highest share since October.

“The inventory scars of the pandemic-era housing market are continuing to fade,” said Danielle Hale, chief economist of Realtor.com. “Although active listings are still short of the pre-pandemic mark, we saw the gap continue to narrow meaningfully as active listings hit a post-pandemic high.”

Hale noted that as more sellers list their homes and buyers become more selective, the time a home stays on the market is increasing, which is helping shift the housing market in a more buyer-friendly direction.

“In response, sellers are curbing expectations and reducing listing prices more often, which could set the stage for more sales this fall, especially if mortgage rates continue to decline,” she said. 

Nationwide inventory grew last month, with the total number of homes for sale increasing by 22.6% year over year. This marks the ninth consecutive month of growth this year, surpassing June’s 22.4% increase.

While inventory remains below pre-pandemic levels, the report found that the gap between current levels and those from 2017 to 2019 is gradually narrowing.

It’s not just more inventory making the market much more favorable to buyers. Sellers are cutting prices on more homes than we saw last year. 

“In addition to seeing inventory levels rise to heights not seen since before the pandemic, buyers are also seeing sellers cut prices on a much larger share of homes than last year,” said Realtor.com Senior Economist Ralph McLaughlin. “These are signs that the housing market is healing from an unhealthy state and becoming more balanced.”

With more sellers entering the market due to decreasing mortgage rates, the report found the share of listings with price cuts increased 18.9% in July, the highest since October. 

In Chicago, 24.3% of listings saw price cuts last month.

It also noted growth in newly listed homes which were up 3.6% from last year but lower than June 2024’s 6.6%, marking the ninth month in a row of increases in new listings – meaning more options for buyers. 

Homes are also staying on the market longer. In July, the typical home spent 50 days on the market, the fourth month in a row where time on market was up from the previous year. Realtor.com did note that while it is five days more than what was seen last July, it’s still 8 days less than the time spent on market in July from 2017 to 2019. 

The median number of days on the market for a home in Chicago is 29, which is seven days less than last year.