Redfin reports more sellers are pulling back amid falling prices and mortgage rate volatility

Redfin reports more sellers are pulling back amid falling prices and mortgage rate volatility
Redfin reports more sellers are pulling back amid falling prices and mortgage rate volatility

SEATTLE–(BUSINESS WIRE)–(NASDAQ:RDFN) — The average home sold below its list price for the first time in more than 17 months during the four-week period ending August 28, as the slowdown of the housing market continued. That’s according to a new report from Redfin (redfin.com), the technology-based real estate brokerage.

Every month since March 2021 has seen an average list sale ratio of over 100%, meaning the average home has sold for more than its final asking price, after all the price drops. This comes as the share of ads with a price drop has finally started to plateau.

Despite falling home prices, demand from home buyers is still cold – mortgage purchase applications and pending sales both saw sharp declines from a year ago – largely thanks to a new surge in mortgage rates, which reached 5.66%, their highest level since June. Home sellers are also reluctant to enter the market: new listings and the total inventory of homes for sale have also seen steep declines.

“While the cooldown seems to be fading, there are signs that there is more room for the market to relax,” said Redfin chief economist Daryl Fairweather. “The post-Labor Day downturn will likely be a little more intense this year than in previous years when the market was very tight. Expect homes to linger in the market, which could lead to a further uptick from sellers lowering their prices. Homebuyers’ budgets are increasingly stretched by rising rates and continued inflation, so sellers must make their homes and price them attractive to attract buyers’ attention during this busy economic period. year.

Leading Indicators of Home Buying Activity:

  • For the week ending August 25, 30-year mortgage rates increased to 5.66%. That’s down from the 2022 high of 5.81%, but up from 3.22% at the start of the year.

  • Fewer people searched for “houses for sale” on Google. Searches in the week ending August 27 were down 26% from a year earlier.

  • The seasonally adjusted Redfin Homebuyer Demand Index – a measure of requests for home visits and other home-buying services from Redfin agents – rose 15% from the 2022 low in June during for the week ending August 28, but was down 16% year-over-year.

  • Touring activity as of August 28 was down 9% from the start of the year, compared with an 11% increase in the same period last year, according to home touring technology company ShowingTime.

  • Mortgage purchase requests were down 2% week-over-week, seasonally adjusted, and 23% year-over-year in the week ending August 26.

Housing Market Highlights for 400+ U.S. Metro Areas:

Unless otherwise specified, this data covers the four-week period ending August 28. Redfin’s weekly housing market data dates back to 2015.

  • The median home sale price was $370,000, up 6% year over year. Prices were down 6% from a record high of $393,725 hit in the four-week period ending June 19. A year ago, they had increased by 0.4% over the same period.

  • Three metro areas saw a year-over-year decline in their median selling price: Honolulu, HI, where prices fell 3.6% to $676,875, Oakland, CA, where prices fell 3% to $918,500, and San Francisco, where prices fell. down 3.7% to $1,453,125.

  • The median asking price for newly listed homes rose 9% year over year to $379,194. Asking prices are down 5.8% from the all-time high reached in the four-week period ending May 22. Last year, during the same period, they were down only 0.4%.

  • The monthly mortgage payment on the median asking price was $2,306 at the current mortgage rate of 5.66%, up 39% from $1,665 a year earlier, when mortgage rates were 2.87% . That’s down from a high of $2,461 hit in the four weeks ending June 12.

  • Pending home sales were down 18% year over year.

  • New home listings for sale were down 16% from a year earlier, the biggest drop since May 2020.

  • Open listings (the number of homes listed for sale at any time during the period) fell 0.9% from the previous four-week period. Year over year, they increased by 4.2%.

  • 35% of homes under contract had an offer accepted within the first two weeks on the market, little change from the previous four-week period, but down from 43% a year earlier.

  • 24% of homes under contract had an offer accepted within a week of entering the market, little change from the previous four-week period, but down from 30% a year earlier.

  • Homes sold were on the market for a median of 26 days, down from 21 days a year earlier and the record low of 17 days set in May and early June.

  • 37% of homes sold above list price, compared to 50% a year earlier.

  • On average, 7.5% of homes for sale each week saw a price drop, a record but unchanged from the previous four-week period.

  • The average sale-to-listing price ratio, which measures how well homes are selling relative to their asking prices, fell to 99.8% from 101.4% a year earlier. In other words, the average home sold for its asking price. It was the first time since March 2021 that the ratio fell below 100%, meaning the typical home is now selling below asking price.

To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-update-homes-sell-below-asking-price/

About Redfin

Redfin (www.redfin.com) is a technology-driven real estate company. We help people find a home with brokerage, instant home buying (iBuying), rental, loan, title insurance, and home improvement services. We sell houses for more money and charge half the fees. We also run the #1 real estate brokerage site in the country. Our homebuyer clients see homes first with on-demand viewings, and our loan and title services help them close quickly. Customers selling a home can receive an instant cash offer from Redfin or have our renovation team repair their home to sell for the best price. Our rental business helps millions of people across the country find apartments and houses to rent. Since launching in 2006, we’ve saved our clients over $1 billion in commissions. We serve over 100 markets in the United States and Canada and employ over 6,000 people.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn more about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin’s press release mailing list, email [email protected] To see Redfin’s press center, click here.

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. Redfin reports sellers pulling falling prices mortgage rate volatility

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