A Q4 2023 survey from the real estate marketplace found that 21% of homeowners are considering selling their homes within the next three years, up from 15% one year prior.

Moreover, the survey found that the share of homeowners considering selling their home was virtually the same whether the interest rate on their mortgage was above or below 5%. Consider that just six months prior, homeowners with rates above 5% were almost twice as likely to consider selling than those with rates below that threshold.

More homeowners, even those with low rates, are apparently warming to the idea of selling, and the current mortgage rates, which remain above 6.5% even though they’ve eased of late, appear to be shrinking as a barrier, at least psychologically.

An increase in homeowners deciding to list their houses is helping relax ongoing supply woes, though the drip is slow. Per Zillow’s figures, inventory grew annually in December for the first time since April. Inventory levels, according to Zillow data, are now 36% below pre-pandemic averages — not an ideal level, but closer to equilibrium than the 46% deficit in May 2023.

The recent easing of rates has helped on the buyer side as well, with monthly mortgage payments on a typical home now at $1,790, or $143 less than they were in October, according to Zillow. Taking the national average into account, it’s the first time since April last year that a new mortgage with a 20% downpayment eats up less than 33% of the median household income.

“Buyers found significant savings as rates fell. But mortgage rates are fickle things, as we’ve seen in recent weeks, and they’ll play a massive role in determining appreciation and affordability — especially for first-time buyers — going forward in 2024,” said Skylar Olsen, chief economist at Zillow. “Fortunately, rate lock appears to be wearing off for some homeowners, who show encouraging signs that they’re ready to come back to the market.”

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The total number of unsold homes, including homes under contract, grew by 3.6% year over year — a pickup that, according to Realtor.com could be attributed to the ongoing climb in newly listed homes. New listings are up 9.1% annually, per Realtor.com data, while active listings are up 4.9% from December 2022.

Home sellers are generally less active during the winter months, and while inventory continues to lag pre-pandemic levels (active inventory remains 34.3% below the typical figure between 2017 to 2019), there are numbers that suggest winter activity is in recovery mode. For example, the month-over-month drop in inventory between November and December has historically hovered between 6.8% and 13.2%. Last year, however, saw just a 5.5% backtrack over the same period.

“Across the U.S., we’re seeing improvements in inventory levels, especially in the South, which experienced a 7.7% increase in active listings year-over-year,” said Danielle Hale, chief economist at Realtor.com.

Inventory in December grew annually in 25 of the country’s 50 largest metros, with many of the largest bumps in the South. The metros posting the largest inventory growth compared to 2022 in December included Memphis (up 28.5%), New Orleans (25.5%) and San Antonio (20.9%). Southern metros Memphis (where new listings were up 35.7%) and Oklahoma City (27.3%) also topped the list when it came to the year-over-year increase of new listings. Thirty-four metro areas saw new listings grow from December 2022.

Hale was swift to point out that while growth in December inventory levels is promising, the elevated interest rate environment remains a substantial barrier against a meaningful supply rebound.

“It is important to note that two-thirds of outstanding mortgages in the U.S. have a rate under 4% and more than 90% have a rate less than 6%,” Hale said. “We are optimistic that inventory levels are moving in a positive direction, but the number of homes on the market is still low relative to pre-pandemic levels. Some sellers are clearly motivated already, but other households may hold out for lower rates before selling or moving to new homes.”

Just three of the 50 largest metros in the country saw higher levels of inventory in December 2023 compared to the typical levels seen between 2017 and 2019: San Antonio (up 12.8%), Austin (11.7%) and New Orleans (11.6%).

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