In addition to home loan rates reaching their highest level in two decades, house prices also rose in the week ending 12 August compared to the same week last year.

"For the third consecutive week, the median home listing price maintained a modest upward trend," said Sabrina Speianu, economic data manager at Realtor.com®, in an analysis.

Record-high mortgage rates are not only dragging down homebuyers, but also tethering home sellers to their homes.

Speianu explains that most homeowners are paying much lower interest rates on their loans than they are now, which "effectively tethers potential sellers" to their property and prevents them from listing it for sale.

The latest figures bear this out: the total number of homes for sale in the week ending 12 August was down 8.6 per cent on the same week last year. New listings were also down, by 8.1 per cent. In fact, new listings have fallen for 58 consecutive weeks.

"The continued drag of existing homeowners choosing to stay put is holding back overall inventory growth," explained Speianu." We expect overall inventory to be down 5 per cent in 2023 compared to 2022."

As the supply of housing dwindles, home prices are also under upward pressure. the national median home price hovered at $440,000 in July, and in the week ending 12 August, prices continued to rise by 0.2 per cent compared to the same week last year.

Nonetheless, homebuyers desperate for good news can still hold out a glimmer of hope: home prices are unlikely to surpass their June 2022 high of $449,000. In fact, as the end of the year approaches, home prices are bound to begin their seasonal decline.

The median list price has already begun its typical seasonal decline, says Spianu.

In other words, lower home prices are ahead. All in all, Speianu believes the market is slowly moving in a "more buyer-friendly direction."

And here's why: while new home listings have been dropping every year, that gap has been narrowing.

"This week's numbers show a 5.9 percentage point improvement over last week," Speianu says.

And homebuyers looking for a solution to low inventory can always turn to newly built homes.

"New home sales continue to climb from year-ago lows," Speianu said.

This summer's hot housing market will cool off this autumn and bring some relief to homebuyers.

Autumn is usually the best time to buy a home, and we see a glimmer of optimism as we look ahead to the upcoming autumn," Speianu noted. If current home supply trends continue, the supply of new listings could surpass the record low levels set last autumn and winter."

The result is that eager buyers who find a home they like shouldn't dilly-dally in making an offer. Homes stayed on the market for six more days in the week ending 12 August than they did at the same time last year, but that slow pace could soon pick up.

By autumn, we could even see homes selling faster than a year ago, Speianu predicts.