Houston, Dallas-Fort Worth, Austin, San Antonio: Even as sales plunge, vacant homes pile on the market that were held off the market during Covid.
By Wolf Richter for WOLF STREET.
The inventory of vacant homes is coming out of the woodwork in Texas, even as sales have plunged and buyers have lost interest.
New listings in the state jumped by 22% in March from February, to 45,004 homes, the biggest number of new listings for any March in the data by realtor.com going back to 2016. Compared to 2019, new listings rose by 14%, and compared to 2018 by 17%. But back then, buyers weren’t on strike and sales hadn’t plunged.
As we can see in the chart, in March, new listings peeled away from the crowded field. The fat red line with big red boxes in all charts below denotes 2025; the dotted red line denotes 2024. This is quite the moment, even as sales are so low:
Active listings in Texas jumped by 26% year-over-year in March, and by 65% from two years ago, to 113,165 homes, the highest for any March in the data from realtor.com going back to 2016. Compared to 2018, active listings were up by 34%, compared to 2019 by 21%. But back then, sales hadn’t gotten crushed.
Active listings already peeled away from the field in mid-2024 and have kept widening the gap.
Shadow inventory is coming on the market: In 2021, active listings had collapsed, but demand was huge and people were buying homes hand-over fist, paying whatever, and seeing how prices exploded, they didn’t put their old home on the market but kept it vacant to ride the price spike up all the way. These vacant homes held off the market for speculative purposes were the reason inventories collapsed back then, as sales soared, and they formed part of the shadow inventory.
Now those vacant homes are coming on the market, but without their owners having to buy a new home because they’d already bought a home years ago, which now causes inventory to balloon and sales to plunge – the reverse of the effect it caused in 2021, when inventories collapsed while sales soared.
A similar situation of the shadow inventory of vacant homes piling on the market, even as sales plunged, is now also playing out in Florida.
In the Dallas-Fort Worth metro (Dallas-Fort Worth-Arlington), active listings jumped by 38% year-over-year and by 91% from two years ago, to 23,675 homes, the highest for any March in the data by realtor.com going back to 2016.
Compared to 2018, active listings are up by 55% and compared to 2019 by 17%.
In the Austin metro (Austin-Round Rock-San Marcos), active listings jumped by 17% in March from February, a huge jump for this time of the year, to 9,229 homes, the highest for any March in the data going back to 2016.
Year-over-year, active listings jumped by 22% from the already high levels a year ago. Compared to two years ago, listings jumped by 41%; compared to 2018, by 46%; and to 2019 by 38%.
This is the same saga of the shadow inventory: Vacant homes that people had moved out of during the pandemic but held off the market to ride up the price spike all the way.
Back then by buying a home in massive numbers without putting their old home on the market, inventory ran down to close to zero in Austin, and prices spiked in a ridiculous manner, by 70% from March 2020 through May 2022.
Now prices have begun to reverse that spike and are down by 23% from the peak through February in the Austin metro, as we noted in our lineup of The 33 Most Splendid Housing Bubbles of America.
Housing charts should never ever look like this. It documents pure housing insanity triggered by the government’s free-money recklessness and the Fed’s even more reckless interest rate repression at the time.
Now the government’s free money is gone, what’s left is the huge debt that this free money left behind, and that no one knows what to do with. The Fed U-turned in 2022, and mortgage rates moved back to 7% today, as per the daily measure by Mortgage News Daily. And the return to anything close to normalcy in terms of prices and sales volume is going to be a long bumpy road, and Austin is an early example of what this might look like.
In the Houston metro (Houston-Pasadena-The Woodlands), new listings also pulled away from the crowd in March when they jumped by 16% in March from February, and by 12% year-over-year, to 11,256 homes, the highest for any March in the data going back to 2016.
Active listings in the Houston metro jumped by 31% year-over-year and by 61% from two years ago, to 28,302 homes, the highest for any March in the data going back to 2016.
But buyers are on strike: In the South, pending sales of existing homes rose month-to-month in February, seasonally adjusted, but were down by 3.4% from the collapsed levels in February 2024, and marked the worst February in the data from the National Association of Realtors. Compared to 2019, pending sales plunged by 29%.
It is this reality of surging inventories – fueled by the shadow inventory now starting to come out of the shadows while sales have plunged amid too-high prices – that has turned the housing market into a further encouragement for buyers to remain on strike and let this play out.
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Near retirement boomers must be getting nervous with recent market action…don’t blame them but then again if you are still heavy in stock near retirement age…then perhaps it’s on you. What’s better to shore up the retirement money by selling extra house while the market is still insanely expensive…now let’s hope there’s enough bagholders to bail them out,
Too bad this is only in Texas, hopefully in due time, this will be the trend in SoCal too, not holding my breath though, there’s special kind of insanity in LA/OC and SD
“Too bad this is only in Texas, hopefully in due time,”
It’s NOT only Texas. It’s happening in lots of places, and the buds are coming out in Southern California too. Florida, the largest US housing market, is even more advanced in this process, and I discussed it here:
https://wolfstreet.com/2025/04/05/inventories-of-existing-homes-in-florida-spike-in-march-to-highest-since-at-least-2016-massive-jumps-in-tampa-miami-orlando-as-buyers-are-on-strike/
And it’s happening in other housing markets that I haven’t discussed yet. I cannot do them all. Just because I don’t discuss it doesn’t mean it’s not happening.
As always, I love it when you correct me on SoCal with data :) My sentiment is strictly based on my nilihilsm towards the market in this part of town and would love to be dead wrong in my assumption. Love to see one day when modest home in this neck of wood isn’t listed at $1M artifical baseline..
I’m in the area and it is coming down, slowly but noticeably. That doesn’t mean the cheerleaders aren’t out there denying reality. Getting insurance is a big problem for buyers. I’m particularly fascinated by the $750k+ prices on 1970s era condos with ever-growing HOA fees reaching into the 800/month price range. Watching closely for new insurance hikes or mandatory retrofit legislation.
Seconded, and I’m starting to think it may accelerate in a significant way.
I live in a formerly blue-collar neighborhood just outside of a fairly high cost city.
Prices have been shooting up (even more than usual) lately, but the interesting thing is that I’m all of a sudden starting to see major remodels of empty homes, and it seems like people‘s second homes/rentals may be about to hit the market.
Inventory is usually pretty tight in my neighborhood, but I wouldn’t be at all surprised to see at least 30 or 40% more homes for sale in the next month or two than at similar times in recent years.
I’ve been curious if other neighborhoods are seeing the same kind of increases in sales preparation, but it’s all anecdotal and it’s pretty hard to tell. Seems like people started planning to hit the spring market pretty hard a while back.
Time will tell…
What area of the country ? CA?
No, western US but further north. I generally stay pretty vague with this stuff…
I know real estate markets are local, but there’s not usually such a powerful universal commonality. Every market I’ve seen is priced far in excess of a couple of critical measures: mortgage cost for a median house compared to median income (means people can’t qualify), and potential mortgage compared to rental value for each property.
Inventories are being kept low – and thus prices remaining inflated – by the steadfast belief houses only go up in value. It won’t take a lot of local market examples for discretionary owners (meaning landlords and vacant homes) to start pulling the trigger. The dominos are starting to fall.
Oddly, in the northwest suburbs of Chicago, there seems to be even fewer homes on the market than a few months ago (just a subjective judgement based on visual scan of Zillow listings).
Chicago Northside is still in the throes of peaking. I’m in the market, going to open houses almost every weekend. More often than not, they’re packed to the gills and nearly everything is under contract by Monday after the first weekend. I’m just not willing to go 20% over what I think a fair value is just to beat out 10 couples willing to max out their budget.
Near retirement boomers could have bought the SP500 at 300 in the 90s, 800-1500 in the 2000s, and now they are getting nervous???
They have been the beneficiaries of the steepest stock gains…ever. Could have made anywhere from 10-20x but a 15% dip and they are all screaming about their retirements. Not to mention they have SS which my generation may or may not get because it is going to run out and no politician wants to deal with it.
They also have limited supply in every market where they congregate which has seen house prices sky rocket and not only that, they also block every multifamily development as well which sees rent sky rocket.
“they also block every multifamily development as well which sees rent sky rocket.”
There is a glut of multifamily rentals following the construction boom in 2021-2023:
Wolf, do this by percentage of current inventory
Eric
That’s irrelevant and circular. Population growth over the past 20 years has been far smaller than before 2000. Housing grows with the population, not with “percentage of inventory” (your circular statement).
@Wolf Thanks for pushing back with real data, rents havve gone down in almost every market in Northern CA due to tens of thousalds of new apartment units.
Whenever I hear “Boomers are blocking multifamily development” I ask the people to tell me the name of even one multifamily development that was “blocked by Boomers (or anyone of any age)”
I do the same thing when people tell me that “the increase in homelessness it caused by high rents”. I ask them to tell me where a homeless guy who “was pushed out of his apartment by high rents works” so I can meet with him and maybe help him get back into an apartment.
I agree with your assessment but trying to explain people’s irrationality is a fool’s errand. Plus, most of us, perhaps myself included suffer from ratchet effect…once something goes up, it’s unacceptable for it to go down by any measure..unless down is a good thing that any up is the end of the world. If all can zoom out and think at a much larger marco implication based mindset, we wouldn’t be stuck in this insane version of the multi-verse..
Yes that is my point exactly! A 15% correction from the top is pretty normal. The tariff whipsaw isn’t true.
But think stonks should always go up is so foolish
Remember the boom isn’t just about births and growth. It will result in the greatest demographic cliff ever. Prices of those markets initially will seem like a great relief, then within a couple years a real nightmare.
can you elaborate on what you mean by the greatest demographic cliff ever?
I think L.A. is going to be somewhat different as the fires impacted rents and will impact sales. Anyone with adequate insurance and a job is going to be looking, and some of those who have the income (Palisades especially) will want to stay. But I think you’re still looking at 5-10 years of rebuilding, and I expect Altadena to become much more multi-family than it was before.
But yes, boomers moving to a fixed income will be impacting markets all across the nation. Especially as, having loaded us up with debt, they now devalue the dollar. That loss of purchasing power is not that different than inflation.
FastCompany has been doing a monthly article on the inventory levels too, yoy and compared to 2019. Check it out, inventory is spiking a lot of places. It would be nice if there were more widespread Austin like price declines though 🤞
You mention shadow inventory from vacant homes but I don’t see any data on the number of vacant homes? Where is that coming from?
Who do you think lives in these homes that are on the market for sale? 20 hippies squatting in each of them?
You know most of them are vacant because the sellers aren’t buying another home, they already did and moved out, many of them a few years ago, which is why sales have plunged even as inventory has sored.
There are over 15 million vacant housing units in the US, 6.6 million of which have been “held off the market,” of which 3.5 million have been held off the market without being used at all for anything (Census Data)
Wolf, It’s interesting how realtor associations and home builders peddle their SFR shortage message in the face of the facts that you cited above. They are no better than the diamond cartels when it comes to fibbing.
TRUMP 90-DAY TARIFF PAUSE
EXCEPT CHINA: DUTIES RISE TO 125%
DOW +2200
125% huh? This is quickly turning into little kids saying infinity and the next kid is saying infinity+1
Well, we all know that housing market needs to go down substantially to meet the new rates. With the new boss – tarrifs are forever, no wait, they’re subject to negotiation, no let’s pause that…uncertainty rules the day. Will this go national? One can only hope for the soft landing, then. That’s my vote – just a long downward slide for several years.
pause for 90 days….instead 2000+ pts up…would make a nice handsome profit, if you bought yesterday and unload today but I am sure no one from the insider will ever do that…
As for interest rates, at least for short term, any conventional wisdom might need to re visit very soon…pressure campaign is already starting to call out Pow Pow and we know usually where that will go….
Market manipulation and insider trading are probably not crimes anymore in the new America for the right people…nor is tax fraud.
But yes we all know that Powell has the spine of a jellyfish if the big guy turns his full attention that way. At this rate though we may see a market crash and recession that necessitates a rate drop, if people start waking up to the overjuiced nature of all assets. But what we haven’t seen to justify any of these ideas, are job losses. If those start coming, we’ll know that the merde has hit the fan for real.
Bruh, it has never really been that illegal. Congress has made a ton and pays like a 250 fine.
Powell has more money than he could ever spend,
is not an ostentatious spender anyway,
is a highly intelligent man who undoubtedly despises Trump,
surely has no interest in another term,
surely cares now only about his place in history,
and so is going to do his damndest to strike the best balance he can between inflation and unemployment.
He was strongly opposed to QE back when Bernanke started it,
and undoubtedly resorted to it during the Covid crisis because there was very clear danger of complete collapse.
We are not on the verge of complete collapse.
“Houston, we have a problem….”
Best comment of 2025
Call SpaceX, they will fix everything right up…ask the residents near Boca Chica after their recent launch
Btw, major props to the hardworking people at PPT, glad to see they sober up and doube time their work.
Couple of NASA employees should have thought of giving Joe their
phone number.
Howdy Folks Foreclosures are still down too. Wait for those to appear and use your HELOC to uncuff yourself…….
I just sold my dead father’s house in Houston. As an estate managed from another state you would call me a motivated seller, plus the old man didn’t do any maintenance on the house in years plus started a DIY project years ago that never got finished. So it was sold as a fixer-upper right at $500K (with buyer credit for fixes) vs. a fixed-up, maintained equivalent listing for about $550. The ~10% discount sold it in one week.
Well done.
Wow 500k or more in Houston many areas some of the least expensive homes in the country .
I just sold a MIL estate home in Edmond Ok sold in 5 days priced at 1.35 a sq ft for 444k . (3000 sq ft ) Move in ready but 1960s style low ceilings dark etc well maintained 1 acre
In those 5 days had 15 viewers but 1 offer full price still significantly lower than new homes nearby . Bought by 60 year old retired widower so he likes home the way it is. The young folks that looked (15 of them) did not like the 1960s layout not open concept no walk in closets and small bathrooms plus stand alone kitchen .
Anyway the home is sold !!
There were few comps because the town in 1960 was 10000 and now 100000 plus so all the comps are new homes
Good information here. Would love to see Charleston, SC as building went crazy since Covid. The South chart probably is a reflection of most cities.
1:02 PM 4/9/2025
Dow 40,608.45 +2,962.86 7.87%
S&P 500 5,456.80 +474.03 9.51%
Nasdaq 17,124.97 +1,857.06 12.16%
VIX 33.04 -19.29 -36.86%
Gold 3,107.20 +117.00 3.91%
Oil 62.71 +3.13 5.25%
About time. The housing market moves as slow as molasses. I enjoyed watching the nasdaq today jump 8% in a couple of minutes and closed 12% higher. It confirms my view that the stock market over the short-term acts like a psychotic, and main stream media responds like psychotics.
I am not sure why stocks are so excited. It is a 90 day PAUSE. Unless deals are made, the same downturn we saw the last few days will happen in 90 days. Trump is still tariffing (is that a word?) China, our biggest and worst offending trade partner. Also our biggest enemy.
Glad the Fed stayed out of it, as Powell said he would. The Fed finally did something right.
It’s not even a pause really. It’s a temporary reduction of the reciprocal tariffs to a universal 10% for 90 days. All other tariffs remain the same. Tariffs on China got hiked. Hot off the press:
https://wolfstreet.com/2025/04/09/trump-speaks-and-stocks-spike-after-trump-spoke-and-stocks-plunged-makes-you-wonder-why-even-own-stocks/
Reserve balances with FR District Banks:
3,427,049
Bank credit:
2025-03-26: 18,154.6314
2025-03-19: 18,128.1940
2025-03-12: 18,096.5631
2025-03-05: 18,092.5348
2025-02-26: 18,064.9656
Money isn’t tight. The economy may be decelerating but is not in recession territory. If Powell knew what he was doing he would reinstitute Reg. Q ceilings for the commercial banks exclusively.
I’ve seen yt podcasts that the socal housing market might only decline for a year, but the lack of housing permits is causing a supply bottleneck. Wouldn’t massive speculation and mostly sunny all year weather offset boomers liquidating estates? They’re also buying more houses than millenials, but maybe wealth effect declines from Trump policy will curb that?
So many questions…
In terms of why demand and prices will explode later this year or whenever per some Youtuber… it’s always the same whatever.
But there is a really important concept that you need to know:
When boomers buy a house, they’re generally moving, so they’re selling their old house. This adds 1 house to the supply and 1 house to the demand with zero impact on the overall market (+1 -1 = 0).
When younger people buy their first house (“first-time buyers”), they’re taking a house off the market without adding a house. So they DO impact the market, unlike boomers.
So the statement that boomers buy more houses is misleading. It’s not the boomers’ buying that impact supply-and-demand, it’s first-time buyers.
When older people move out permanently (retirement facility, death, etc.), then they add 1 house to the supply without adding 1 house to demand, and they DO impact the market by adding supply.
This is a really important concept, which is why first-time buyers are tracked by the NAR.
@Wolf as a young Bay Area Boomer it seems like almost everyone I know has bought a “second” (and even many 3rd) homes in the past decade (Tahoe, Stinson, Palm Springs and even condos in SF). Since I grew up in the Bay Area mose people around my age are getting (or have already got) millions of (tax free) cash when their parents die and they inherit the Bay Area homes so there will still be more Boomers buying without selling (My wife wants to pay cash for a beach place at Pajaro Dunes when my parents die, but I want to buy more 50% LTV apartments)…
Those are vacation homes. I don’t track the Tahoe area at all for that reason. I track big cities were people actually live. But people have homes in multiple big cities because of a job change or whatever, and they didn’t sell the left-behind home back then. I know those situations, and they’re thinking about selling the left-behind house because it’s getting expensive to carry, and they don’t really use it, and it’s gone up a lot in price, and they don’t want to turn it into a rental property. And that’s part of what we’re seeing.
Wolf, I assumed in those stories that boomers would want to keep in the locked in historically low rate from their first home, use it as rental and use it to finance the 2nd more “livable” empty nest home.
I’ve also had concerns of corporate renters, speculators, crowd funded reits, and foreign asset parkers sopping up more in demand houses in the west coast. Granted with economy slowing down, rates being high, and buyers going on strike, this is slowly correcting itself but isn’t it always present whenever conditions like ~4% rates or lower prices become favorable again?
For any of you who follow the real estate market, Melody Wright has a youtube channel and X account under that name and she is awesome. Shes been reporting on this for the past two to three yrs now.
Does vacant mean not occupied or just on the market for sale? Can’t imagine they can track empty house on market versus occupied by owners/tenants and looking to sell.
Manhattan is the only place for parking money in the real estate.
Here in the Coachella Valley (Palm Springs – Palm Desert), a residential realtor told me that a huge wave of listings will be coming on the market over the next couple of weeks. According to this person, most of the listings will be Canadians who have had enough of the present administration. This will be an interesting story to follow over the next couple of months.
Meanwhile, a NOD was filed against a 95,000 sq ft commercial building. The number of CRE NODs and foreclosures are starting to climb here as well.
Canadians age in competition with Australians for stupidity in the western world. Retirees returning home to where medical care includes an offer of assisted dying. Last statistic I saw was that 2% of deaths in Canada were assisted deaths.
How did you determine all these homes were vacant shadow inventory held over from COVID?
Where do you think they came from suddenly after the inventory collapse during the pandemic??? Mars?
Texans love to brag about their booms and begrudgingly acknowledge the busts. I’m sure my friends & family down there will be happy to buy with the current dip and then cry to heaven when it dips further.
But, since we’re a months into this presidency and the promised land has yet to appear as promised, a good ole housing retraction could be just what the doctor ordered. You know, to allow people to actually afford homes.