High mortgage rates and harsh weather are
pushing down home sales, but some house hunters are touring and
getting a feel for the market
(NASDAQ: RDFN) —Pending sales are down 8%, the biggest decline
in four months, according to a new report from Redfin (redfin.com),
the technology-powered real estate brokerage.
Daily average mortgage rates posted their biggest one-day
increase in over a year on February 2. The jump came after a
hotter-than-expected January jobs report and the Fed’s confirmation
that they’re unlikely to cut interest rates in the next two months,
which means mortgage rates will probably remain elevated near their
current level for at least that long.
Rising home prices are exacerbating rising rates, with the
typical monthly mortgage payment just about $100 shy of October’s
all-time high. High housing costs are pricing out many would-be
homebuyers. There are also a few other contributors to sales
falling: Harsh winter weather in the first half of January delayed
a lot of homebuying deals, and pending sales were improving at this
time last year as mortgage rates temporarily dropped.
Still, some house hunters are at least getting a feel for the
market. Redfin’s Homebuyer Demand Index—a seasonally adjusted
measure of requests for tours and other buying services from Redfin
agents—has steadily risen since mid-January, and a separate measure
of home tours shows they’ve increased 16% since the start of the
year, compared with a 10% rise at this time last year. Some sellers
are jumping in, too, with new listings up 7% year over year.
“We’re seeing a bit of recovery with house hunters touring
homes, but even demand at the earliest stages isn’t up as much as
we would expect at this time of year,” said Chen Zhao, Redfin’s
economic research lead. “That’s because mortgage rates are climbing
again and winter weather has been harsher than usual in much of the
country, keeping some house hunters at home.”
Luis Rojas, a Redfin Premier agent in the Viera West, FL area,
said today’s housing market is touch and go. “High mortgage rates
brought the local market to a near-standstill from August through
November, activity picked up when rates dropped a bit in
mid-December, and now it’s slowing down again as rates rise,” Rojas
said. “I’m advising buyers–especially first-timers–that the
mortgage rates they see in the news aren’t the be-all and end-all.
Some local lenders are willing to give rates in the 5% range for
new construction projects because any business is better than no
business.”
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
6.92% (Feb. 7)
Up from 6.75% a week earlier
Up from 6.39%
Mortgage News Daily
Weekly average 30-year fixed mortgage
rate
6.63% (week ending Feb. 1)
Near lowest level since May
Up from 6.09%
Freddie Mac
Mortgage-purchase applications
(seasonally adjusted)
Down 1% from a week earlier; up 3% from a
month earlier (as of week ending Feb. 2)
Down 19%
Mortgage Bankers Association
Redfin Homebuyer Demand Index
(seasonally adjusted)
Up slightly from a week earlier, but down
7% from a month earlier (as of week ending Feb. 4)
Down 14%
Redfin Homebuyer Demand Index, a measure
of requests for tours and other homebuying services from Redfin
agents
Google searches for “home for
sale”
Down 2% from a month earlier (as of Feb.
3)
Down 16%
Google Trends
Touring activity
Up 16% from the start of the year (as of
Feb. 6)
At this time last year, it was up 10% from
the start of 2023
ShowingTime, a home touring technology
company
Key housing-market data
U.S. highlights: Four weeks ending
February 4, 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 February 4,
2024
Year-over-year change
Notes
Median sale price
$361,498
5.4%
Biggest increase since Oct. 2022
Median asking price
$395,949
7%
Biggest increase since Sept. 2022
Median monthly mortgage payment
$2,607 at a 6.63% mortgage
rate
11.5%
Down roughly $110 from all-time high set
in October 2023, but up roughly $250 from the four weeks ending
Dec. 31
Pending sales
68,872
-7.8%
Biggest decline since October 2023
New listings
70,415
6.6%
Active listings
740,834
-3.5%
Months of supply
4.2 months
Unchanged
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
33.3%
Up from 32%
Median days on market
48
-2 days
Share of homes sold above list
price
22.4%
Up from 20%
Share of homes with a price
drop
5.5%
+1 pt.
Average sale-to-list price
ratio
98.2%
+0.5 pts.
Metro-level highlights: Four weeks
ending February 4, 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
Miami (13.4%)
Anaheim, CA (13.4%)
Detroit (13.3%)
Warren, MI (12.1%)
Chicago (11.3%)
San Antonio, TX (-4.7%)
Austin, TX (-3.7%)
Declined in 2 metros
Pending sales
San Jose, CA (13.8%)
San Francisco, CA (6%)
Anaheim, CA (4.5%)
Riverside, CA (0.4%)
Columbus, OH (0.2%)
San Antonio, TX (-33.2%)
Portland, OR (-30.2%)
Nashville, TN (-21.5%)
New Brunswick, TN (-19.4%)
Houston (-18.5%)
Increased in 5 metros
New listings
Dallas, TX (27.1%)
Miami (26.9%)
Jacksonville, FL (26.3%)
Fort Lauderdale, FL (23.6%)
San Diego, CA (22.1%)
Chicago (-17.8%)
Atlanta (-16%)
Milwaukee, WI (-14%)
Portland, OR (-13.6%)
Nashville, TN (-10.4%)
Declined in 14 metros
To view the full report, including charts, please visit:
https://www.redfin.com/news/housing-market-update-pending-sales-decline-mortgage-rates-rise
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
also run the country's #1 real estate brokerage site. Our
home-buying customers see homes first with same day tours, and our
lending and title services help them close quickly. Customers
selling a home in certain markets can have our renovations crew fix
up their home to sell for top dollar. Our rentals business empowers
millions nationwide to find apartments and houses for rent.
Customers who buy and sell with Redfin pay a 1% listing fee,
subject to minimums, less than half of what brokerages commonly
charge. Since launching in 2006, we've saved customers more than
$1.5 billion in commissions. We serve more than 100 markets across
the U.S. and Canada and employ over 4,000 people.
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/20240208768004/en/
Redfin Journalist Services: Kenneth Applewhaite, 206-414-8880
press@redfin.com
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