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I would assume it has to do with the amount of buyers.
Many current owners wouldn’t sell their own residence now because their mortgages are so good (usually the rate is low from pre-2022 mortgages or perhaps the home valuation was low from pre-2020 mortgages). So, they are not interested in becoming buyers.
I think there are buyers (people have to move for all sorts of reasons) and they have cash from the frothy markets of the past decade, but there is not a ton of them. Finding the right one may take some time.
Yet, sellers may be willing to hold out since the carrying costs of their home are relatively low (i.e., it’s a good mortgage and they can afford to make an extra payment or two if it means a higher sales price).
It's tempting to sell, but probably best to just wait it out for now. The pendulum always ends up swinging back the other way eventually.