More home sellers are cutting their asking
price, suggesting sale-price growth could soften in the coming
months. But this week, the median sale price rose to another record
high, pricing out some buyers.
(NASDAQ: RDFN)—Nationwide, 6.4% of home sellers cut their asking
price during the four weeks ending May 26, on average, the highest
share since November 2022. That’s according to a new report from
Redfin (redfin.com), the technology-powered real estate
brokerage.
The median asking price dropped roughly $3,000 to $416,623 in
the last week, the first decline in six months. Additionally,
for-sale supply is growing more stale: Age of inventory (the
typical number of days active listings have been on the market)
started rising year over year in May for the first time in eight
months, hitting a median of 46 days. Together, those metrics
suggest sale-price growth could soften in the coming months as
persistently high mortgage rates turn off homebuyers. For now, the
median-home sale price is up 4.3% year over year to another record
high, though sale prices are a lagging indicator because they’re
typically negotiated at least a month before a deal closes.
Buyers did get a modicum of relief on housing costs this week.
The typical U.S. homebuyer’s monthly housing payment dropped to
$2,812, its lowest level in six weeks. Payments are declining
because even though sale prices remain at all-time highs, mortgage
rates have come down from their peak: The weekly average mortgage
rate is 6.94%, the first time it has dipped below 7% since early
April. (It’s worth noting that the reprieve in rates may be
short-lived; daily average rates started increasing this week after
a string of disappointing treasury auctions.)
High costs are dampening demand. Pending sales are down 3.4%
year over year, on par with declines over the last month, and
mortgage-purchase applications are sitting near their lowest level
in six months. Low inventory is another factor pushing down sales.
Even though 7.8% more new listings hit the market than during the
same period last year, listing growth has been losing momentum for
the last few months, leaving buyers with fewer homes to choose from
than there typically are in May.
“The market is slower than usual, but well-maintained properties
listed for under a million dollars still get multiple offers,” said
Christine Chang, a Redfin Premier agent in the Bay Area. “People
who are buying right now are typically doing so because they’re
having a baby or looking for a more family friendly home. My advice
for those buyers is to be open-minded: Consider single-family homes
that are a bit outdated but don’t need major renovations, and/or
homes in lesser-known, non-trendy neighborhoods. That type of home
tends to sit on the market longer, and buyers may be able to avoid
competition and get a home for asking price instead of engaging in
a bidding war. Buyers who can get by with less space should
consider a condo; they’re relatively unpopular right now and many
are going under asking price.”
For Redfin economists’ takes on the housing market, including
more on how current financial events are impacting mortgage rates,
please visit Redfin’s “From Our Economists” page.
Leading indicators
Indicators of homebuying demand and
activity
Value (if applicable)
Recent change
Year-over-year change
Source
Daily average 30-year fixed mortgage
rate
7.34% (May 29)
Up from 6.99% 2 weeks earlier, but down
from a 5-month high of 7.52% 5 weeks earlier
Up from 6.95%
Mortgage News Daily
Weekly average 30-year fixed mortgage
rate
6.94% (week ending May 23)
Down from 5-month high of 7.22% 3 weeks
earlier
Up from 6.57%
Freddie Mac
Mortgage-purchase applications
(seasonally adjusted)
Declined 1% from a week earlier (as of
week ending May 24)
Down 10%
Mortgage Bankers Association
Redfin Homebuyer Demand Index
(seasonally adjusted)
Down 7% from a month earlier to lowest
level in 3 months (as of week ending May 23)
Down 12%
Redfin Homebuyer Demand Index, a measure
of requests for tours and other homebuying services from Redfin
agents
Touring activity
Up 10% from the start of the year (as of
May 27)
At this time last year, it was up 12% from
the start of 2023
ShowingTime, a home touring technology
company
Google searches for “home for
sale”
Unchanged from a month earlier (as of May
28)
Down 14%
Google Trends
Key housing-market data
U.S. highlights: Four weeks ending May
26, 2024
Redfin’s national metrics include data
from 400+ U.S. metro areas, and is based on homes listed and/or
sold during the period. Weekly housing-market data goes back
through 2015. Subject to revision.
Four weeks ending May 26, 2024
Year-over-year change
Notes
Median sale price
$390,613
4.3%
All-time high
Median asking price
$416,623
6%
Median monthly mortgage payment
$2,812 at a 6.94% mortgage rate
7.3%
$58 below all-time high set during the 4
weeks ending April 28
Pending sales
89,218
-3.4%
New listings
101,172
7.8%
Active listings
912,320
15.2%
Highest level since Dec. 2022
Months of supply
3.2
+0.5 pts.
4 to 5 months of supply is considered
balanced, with a lower number indicating seller’s market
conditions
Share of homes off market in two
weeks
44.7%
Down from 49%
Median days on market
32
+3 days
Share of homes sold above list
price
31.8%
Down from 34%
Share of homes with a price
drop
6.4%
+2 pts.
Highest level since Nov. 2022
Average sale-to-list price
ratio
99.5%
-0.2 pts.
Metro-level highlights: Four weeks
ending May 26, 2024
Redfin’s metro-level data includes the 50
most populous U.S. metros. Select metros may be excluded from time
to time to ensure data accuracy.
Metros with biggest year-over-year
increases
Metros with biggest year-over-year
decreases
Notes
Median sale price
Anaheim, CA (19.3%)
Detroit (16.4%)
Nassau County, NY (12.5%)
San Jose, CA (12.4%)
West Palm Beach, FL (12.4%)
Fort Worth, TX (-0.4%)
San Antonio, TX (-0.3%)
Decreased in 2 metros
Pending sales
San Jose, CA (13.7%)
San Francisco (7.2%)
Columbus, OH (6.5%)
San Diego (5.3%)
Anaheim, CA (4.2%)
Houston (-15.1%)
West Palm Beach, FL (-14.4%)
Atlanta (-14.1%)
Fort Lauderdale, FL (-12.5%)
Orlando (-11.5%)
Increased in 13 metros
New listings
San Jose, CA (34.5%)
Phoenix (24.7%)
San Diego (21%)
Oakland, CA (20.1%)
Montgomery County, PA (19.5%)
Chicago (-10%)
Atlanta (-9.4%)
Newark, NJ (-6.4%)
Detroit (-3.4%)
Warren, MI (-1.9%)
Decreased in 8 metros
To view the full report, including charts, please visit:
https://www.redfin.com/news/housing-market-update-sellers-drop-asking-prices
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate
company. We help people find a place to live with brokerage,
rentals, lending, title insurance, and renovations services. We run
the country's #1 real estate brokerage site. Our customers can save
thousands in fees while working with a top agent. Our home-buying
customers see homes first with on-demand tours, and our lending and
title services help them close quickly. Customers selling a home
can have our renovations crew fix it up to sell for top dollar. Our
rentals business empowers millions nationwide to find apartments
and houses for rent. Since launching in 2006, we've saved customers
more than $1.6 billion in commissions. We serve more than 100
markets across the U.S. and Canada and employ over 4,000
people.
Redfin’s subsidiaries and affiliated brands include: Bay Equity
Home Loans®, Rent.™, Apartment Guide®, Title Forward® and
WalkScore®.
For more information or to contact a local Redfin real estate
agent, visit www.redfin.com. To learn about housing market trends
and download data, visit the Redfin Data Center. To be added to
Redfin's press release distribution list, email press@redfin.com.
To view Redfin's press center, click here.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240530263072/en/
Redfin Journalist Services: Kenneth Applewhaite
press@redfin.com
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