More Houses Coming on the Market in 2021, Especially Smaller Ones

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A recent report published by showed there are more houses coming onto the real estate market in 2021. In particular, their data revealed that there are more smaller homes coming on the market.

This is good news for home buyers in general, and especially for first-time buyers who often shop for more affordable starter houses in the smaller size range.

It also bodes well for those who are planning to make a purchase later this year or in early 2022. If this trend continues, it would give buyers more properties to choose from while easing competition.

Report: More Houses Coming onto the Market in 2021

In August 2021, researchers from published a housing market update for the nation as a whole and the 50 largest metro areas. Among other things, this report showed there are more houses coming onto the market in summer 2021.

This is one of several reports that have shown increased inventory levels within the U.S. housing market.

Specifically, the report showed a measurable increase in the number of new real estate listings in July of this year. Last month, new listings nationwide rose by 6.5% compared to a year earlier.

In major U.S. cities, the numbers were even more impressive. Within the nation’s 50 largest metropolitan areas, new real estate listings rose by 11% in July 2021 (compared to a year earlier).

Property listings increased the most in the following metropolitan areas:

  • Columbus, Ohio 42.9%
  • Baltimore, Maryland 36.9%
  • Cleveland, Ohio 35.8%
  • Richmond, Virginia 30.1%

In the above cities, and others like them, the housing market is starting to balance out in a way that should favor local home buyers. Ongoing inventory growth will give people more options to choose from, when buying a house.

At the national level, July marked the fourth month in a row where new listings had increased. This means there are more houses coming on the market in summer 2021 than there were a year ago.

An Increase in the Percentage of Smaller Homes

This report also revealed a measurable increase in the percentage of smaller homes that are coming onto the market in 2021. defines a “smaller” house as having somewhere between 750 and 1,750 square feet.

These are the smaller, more affordable properties that tend to be popular with first-time home buyers and those with a limited budget. The overall market share of smaller homes rose to 36% in July 2021, up from 30% a year earlier.

This is an important trend for several reasons. As we have written in the past, smaller starter homes have been especially hard to come by over the past year or so. Housing market inventory is down across the board. But the shortage seems to be most profound among smaller houses.

All of this is good news for home buyers in the U.S., especially first-time buyers who are seeking a smaller and more affordable property. If this trend continues, it could be easier to find and purchase a house later in 2021 and into 2022.

A More ‘Buyer-Friendly’ Real Estate Market?

With more houses coming onto the market in 2021, real estate conditions across the U.S. could become a bit more balanced in the coming months.

This is just one of several recent reports that suggest a general cooling trend within the nation’s housing market. Similar reports have shown a reduction in the number of home sales, along with signs of inventory growth.

According to Danielle Hale, the chief economist for, all of these trends could make for a more buyer-friendly real estate market over the coming months.

As Hale stated in the above-mentioned report:

“The feverish pace of home sales is beginning to follow historical seasonal patterns, while new listings grew at an unusually high rate for the summer months, further helping the inventory crunch. This is shifting the housing market balance in a more buyer-friendly direction…”

The report points to an increase in the number of new real estate listings. But total or overall housing market inventory is still down in almost every city across the country, compared to a year ago. The rise in new listings is essentially slowing the rate of overall inventory decline. So it’s a positive trend from a home buyer standpoint. We just need to look at it in a broader perspective.

While there are more houses coming onto the market in 2021, those planning to buy a home should still be prepared for stiff competition. Real estate markets across the country might be becoming a bit more buyer-friendly. But most cities are still experiencing seller’s market conditions due to the ongoing inventory crunch.

Brandon Cornett

Brandon Cornett is a veteran real estate market analyst, reporter, and creator of the Home Buying Institute. He has been covering the U.S. real estate market for more than 15 years. About the author