Posted on
May 8, 2025
by
Garry Voigt
In real estate, timing is everything—and that includes timing around inventory levels. Over the past few years, market dynamics have shifted dramatically. While we once grappled with record-low inventory and bidding wars, many markets are now facing the opposite issue: a wave of pent-up inventory.
But what exactly does that mean—and why does it take time to "chew through" all those listings?
What is Pent-Up Inventory?
Pent-up inventory refers to a buildup of homes for sale that haven’t been absorbed by buyers at the usual pace. This can happen for a number of reasons: interest rate hikes that curb buyer enthusiasm, seasonal slowdowns, economic uncertainty, or simply too many homes coming on the market at once.
In markets that were overheated for years, some homeowners who waited on the sidelines are now deciding it's time to sell. The result? An influx of listings hitting the MLS all at once.
Why More Listings Don’t Equal Instant Sales
It's tempting to assume that a high number of listings means an active market—but that’s not always the case. Just because there are more homes for sale doesn’t mean there are enough ready buyers to match that supply.
Here’s where it gets important: the market needs time to digest excess inventory. Think of it like a backlog. Buyers need time to:
Shop and compare new options
Adjust to pricing (especially if there’s downward pressure)
Secure financing in a high-rate environment
Build confidence in a changing economy
Even if a listing is priced well and shows beautifully, it's now competing with a lot more neighbors. That leads to longer days on market, more price reductions, and—ultimately—a more balanced playing field.
What Sellers Should Know
If you're planning to sell, understand that patience is key. The flood of new inventory won’t clear overnight. Even in desirable neighbourhoods, homes may sit a bit longer than they would have a year ago. Pricing strategically and working with a knowledgeable agent (like us!) who understands the local absorption rate is more important than ever.
What Buyers Should Know
For buyers, this kind of environment can be a real opportunity. With more listings to choose from, less competition, and potentially more negotiable sellers, this could be a great time to buy—especially if you're thinking long-term.
Bottom Line
Real estate markets don't adjust instantly. When there's a large buildup of listings, it takes time—sometimes months—for the market to rebalance. Whether you’re buying or selling, understanding how inventory flows through the market is crucial to making smart, timely decisions.
If you’ve been wondering whether now is the right time to make a move, let’s talk about your local market and where the trends are heading.
