Supply of existing homes in the United States reached its highest point since 2021, good news for prospective buyers and brokers grappling with a market slowed by all-time high prices.

In April, the supply of pre-owned single-family houses, condominiums and co-ops reached 1.2 million units. That’s up 9% from March and 16.3% from one year ago, according to data released by the National Association of Realtors. It’s the fourth consecutive month of total existing stock increases and the first time existing stock has been this high since October 2021.

The supply growth comes as it remains historically low. Various factors have contributed to this shortage, but one of the main culprits is the lock-in effect. Existing homeowners are staying in place, rather than moving, to avoid mortgage rates that are hovering around 7%. That’s putting pressure on supply, driving up prices and creating a tight market for brokers and prospective buyers.

Increased supply is “very good news,” NAR Chief Economist Lawrence Yun said on a call with reporters, but compared to 2019, supply is still tight.

“We still have tight inventory, despite the fact that we had this increase in inventory from one year ago,” Yun said. “It’s just a testament of how tight the market was. … We’re coming off that super tight market condition.”

The supply of unsold existing homes is enough to satisfy three-and-a-half months of demand, according to NAR’s data. That’s an increase from last month and this time last year, and it brings the supply closer to the ideal four to six months of supply that economists view as healthy.

Yun said increases in supply are driven by ramped-up builder production that typically shows up eventually in existing home inventory. A changing consumer mindset is also disrupting the market.

“Even at higher mortgage rates, live changes, which is always ongoing, will lead to some increase in inventory,” he said. “Maybe people are accepting that we may be in this new normal high-interest-rate environment.”

The resale market is still struggling. Sales of existing single-family homes dropped in April for the second month in a row, defying analyst expectations.

Sales dropped 1.9% compared to March to a seasonally adjusted rate of 4.14 million units, according to NAR. Compared to the same time last year, sales slid 1.9%. Analysts widely expected minimal change or even an increase in sales, according to Wells Fargo economists.

But the decline comes with an asterisk. While there was a decrease in seasonally adjusted annual sales, on a nonseasonally adjusted basis, existing home sales increased. That’s because last year, there were 20 business days in the April data. This year, there were only 22 business days.

April’s sales are “not that exciting,” Yun said on the call. Sales have remained around the 4 million threshold for about a year, he said.

At the same time, home prices hit an all-time high in April, with the median cost for an existing home reaching $407,600, up 5.7% from April 2023. That growth is expected to taper off in the coming months because of increases in supply, according to the NAR.

Overall, Yun described the market as “frustrating.”

“The way to describe it is: for home prices, it's record high, so it's frustrating for buyers. It’s good news for homeowners, given that that’s their housing wealth,” he said. “But there's very little mobility, so people who are in the business — whether mortgage lenders, realtors — it's a tough market out there.”