Zillow Says a Faster Market Caused More Homes Sales

Homes are lasting mere days on the market before being scooped up, and Zillow says if this pandemic trend continues, it could be the new normal. As the number of closed sales rise, the number of listings shrinks. This could only be possible, Zillow says, due to the market’s velocity of sales. During the second half of 2019, the speed of sales advanced, days spent on the market decreased, and the number of sales increased. Combined, these resulted in a skinny inventory, and the same occurred in the second half of 2020.

Like a warehouse transitioning to just-in-time inventory management, the U.S. housing market became more streamlined in 2020, with typical home sales occurring much more quickly after initially being listed. And because homes were on the market for so much less time before selling, there was a much smaller stockpile of listed homes observed at any given point in time — what we refer to as inventory.

Homes are also selling incredibly quickly at a time of year when the market generally slows down as the weather cools and people take time off for the holidays. The typical home that sold in the week before Christmas 2019 was on the market for 39 days. In the same week in 2020, the typical sold home was on the market for just 16 days. Put another way: A majority (60%) of homes listed for sale in the first week of November 2019 were still on the market by the end of that month. In 2020, less than half (~40%) of homes listed for sale in the first week of November were still on the market at the end of the month.

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