There were fewer homes for sale in January than ever before as homebuyers made their move on what inventory was available, according to a new Redfin report. 

New listings fell 12.4% from December, bringing total homes for sale in January to a record low, down 2.6% month over month. Despite the drop in new listings, sales rose 7.5% as homebuyer demand continued. That drop in new listings was the largest decline since May 2020 as new listings fell year over year in 84 of the 88 largest U.S. metros. 

Redfin CEO Glenn Kelman said in the company’s fourth-quarter earnings call that the inventory crunch could ease come summer. 

“We’re well aware of the economic pressures on homebuyers, but so many people are still so desperate to move that sales, for now, are still mostly constrained by inventory, not prices or even mortgage rates,” he said. 

With homebuyers having zero leverage for negotiating, even homes that need work are “hyper-competitive” due to all the market investors, according to Dallas Redfin real estate agent Barbara Tidwell-Vincent. 

“Most of the homes hitting the market are listed by people who need to sell — estate sales, major life changes, that sort of thing. With so few homes for sale, everything is getting multiple offers,” she said. 

Mortgage rates rose 0.81 percentage point between Dec. 20 and Feb. 17.  Rising rates could slow competition by summer, according to the report. 

Nationally, January’s median home sale price was $376,200, up 14% from January 2021. Median sales prices increased year over year in all but one of the 88 cities Redfin tracks. In Bridgeport, Conn., prices fell 2% from 2021 after having a 22% year-over-year increase in 2021. The largest increases were in North Port, Fla. up 32%, Austin, Texas, with a 32% increase and Phoenix, up 29%.

January’s seasonally adjusted home sales increased 7.5% from December but were down 4% from January 2021. Sales fell from 2021 in 66 of the 88 largest metro areas, with the biggest declines in Fresno, Calif., down 29%, Seattle, with a 22% decline and San Francisco, down 20%. Honolulu, Miami and Tulsa, Okla., had the largest gains, at 26%, 10% and 10% respectively. 

The report also found active listings fell 18% from 2021 to an all-time low in January. Homes were on the market longer last month and were less likely to sell above list price — 42% of homes sold above list price in January, down 14% from June’s record high, but up 9% from a year ago.