03:31 PM EDT, 03/15/2024 (MT Newswires) -- US housing supply is showing signs of a recovery, with new listings in February increasing to the highest level in 17 months, but prices and mortgage rates are still elevated, a report by Redfin (RDFN) showed Friday.

Sequentially, new listings rose 3.8% on a seasonally adjusted basis to 548,285 last month, the highest level since September 2022. Listings were up nearly 15% from a year earlier, representing the largest annual increase since May 2021. Active listings reached 1.6 million, the highest in a year. The metric fell 0.1% year over year, the smallest annual drop "in months," the real estate brokerage said.

Redfin attributed the supply growth to the easing "lock-in effect," as homeowners who have been holding onto their low mortgage rates eventually have to move.

On an annual basis, new listings climbed fastest in Texas, while active listings increased fastest in Florida. Overall, new and active listings continue to be well below pre-pandemic levels, and demand continues to outpace supply, according to the report.

"Housing supply is finally starting to recover in a meaningful way, which is great news for buyers who for months have been competing for a tiny pool of homes for sale," Redfin Economics Research Lead Chen Zhao said. "Still, many house hunters are hesitant to pull the trigger because mortgage rates and home prices remain elevated."

The median US home sale price in February was $412,778, up 6.6% from a year earlier, the biggest increase since September 2022, Redfin data showed. The average 30-year fixed mortgage rate rose sequentially to 6.78% from 6.64%. The brokerage expects mortgage rates to remain elevated longer than projected after February's consumer inflation data showed an acceleration in prices.

Home sales rose 0.5% sequentially but fell 3.5% annually to 422,203 last month, the data showed.

"The housing market is nothing like it was two years ago during the pandemic homebuying frenzy, but it's better than it was last year," said David Palmer, a Redfin Premier real estate agent. "There still aren't enough listings to quench pent-up buyer demand, but it's getting better."

Price: 5.94, Change: -0.38, Percent Change: -6.01