The median U.S. home sale price hit a record
high in May as demand continued to outpace supply, with the number
of homes for sale roughly 25% below pre-pandemic levels
(NASDAQ: RDFN) — Home sales fell 1.7% month over month in May on
a seasonally adjusted basis and dropped 2.9% from a year earlier,
according to a new report from Redfin (redfin.com), the
technology-powered real estate brokerage. There have been just two
months in the past decade with fewer home sales: October 2023, when
mortgage rates jumped to a 23-year high, and May 2020, when the
onset of the pandemic brought the housing market to a halt and home
sales to a record low.
“Buyers today are facing many of the realities of a hot market
even though few homes are changing hands,” said Redfin Senior
Economist Elijah de la Campa. “Sales are sluggish because high
homebuying costs are making both house hunters and prospective
sellers skittish. And with so few homes for sale, buyers in some
markets are getting into bidding wars, which is helping push home
prices to record highs.”
Sales may pick up later this year if mortgage rates slowly tick
down as expected.
May 2024 Highlights: United States
May 2024
Month-over-month change
Year-over-year change
Median sale price
$439,716
1.6%
5.1%
Homes sold, seasonally adjusted
407,959
-1.7%
-2.9%
New listings, seasonally
adjusted
527,785
0.3%
8.8%
All homes for sale, seasonally adjusted
(active listings)
1,634,420
0.4%
11.1%
Months of supply
2.3
-0.1
0.4
Median days on market
32
-3
0
Share of for-sale homes with a price
drop
19.2%
2.4 ppts
6 ppts
Share of homes sold above final list
price
35.0%
1.4 ppts
-2.4 ppts
Average sale-to-final-list-price
ratio
99.9%
0.2 ppts
-0.1 ppts
Average 30-year fixed mortgage
rate
7.06%
0.07 ppts
0.63 ppts
Note: Data is subject to revision
Home Prices Hit Another Record High in May, and Mortgage
Rates Kept Climbing
The median home sale price rose 5.1% year over year in May to a
record $439,716. The average 30-year-fixed mortgage rate hit 7.06%.
That’s up from 6.99% one month earlier and 6.43% one year earlier,
and is more than double the all-time low of 2.68% during the
pandemic. Daily average mortgage rates did drop to their lowest
level in about three months this week after the latest CPI report
showed that inflation is continuing to cool.
Even though homes are selling for more than ever before, many
sellers are still having to lower their list prices after putting
their homes on the market—one silver lining for buyers.
Nearly One of Every Five Homes for Sale Faced a Price
Cut
Nearly one in five (19.2%) homes for sale in May had a price
cut, up from 13.2% a year earlier and just shy of the 21.7% record
high set in October 2022.
Some sellers are reducing their prices because they listed their
home for too much initially and it ended up sitting on the market.
The typical home for sale in May spent 32 days on the market. While
that’s comparable with a year earlier, it’s the highest level for
any May since the start of the pandemic.
Price drops are particularly common in areas where housing
supply has been rising quickly, like Florida and Texas. In these
areas, individual home sellers have been facing strong competition
from homebuilders.
The Housing Shortage Is Improving, But Remains Severe
New listings rose 0.3% month over month in May on a seasonally
adjusted basis and climbed 8.8% from a year earlier. Still, they
were roughly 20% below pre-pandemic (May 2019) levels. That’s
largely because many homeowners don’t want to sell, as they feel
“locked in” by the low mortgage rate they scored during the
pandemic.
Active listings, or the total number of homes for sale, rose
0.4% month over month on a seasonally adjusted basis and jumped
11.1% from a year earlier—the largest annual gain since the start
of 2023. Still, active listings were about 25% below pre-pandemic
levels.
While new listings represent the number of homes that were
listed for sale during a given month, active listings represent the
total number of homes that were for sale during a given month. That
means that the latter metric includes homes that aren’t selling.
One reason active listings have risen so much is that in some
areas, homes are lingering on the market and getting stale.
Active listings are also soaring along Florida’s southwest Gulf
Coast. In North Port, they surged 51.1% year over year on an
unadjusted basis—the largest increase in the nation. Next came
Tampa (46%) and Cape Coral (45.1%). Those housing markets are
cooling faster than anywhere else in the country amid a
new-construction boom, intensifying natural disasters and soaring
insurance costs, a separate Redfin report found.
Meanwhile, many of the markets that are holding up best and
seeing price increases—like Rochester, NY—are relatively affordable
and have near-record-low supply.
Metro-Level Highlights: May 2024
- Prices: Median sale prices rose most from a year earlier
in Anaheim, CA (17.6%) Cleveland (15.1%) and Nassau County, NY
(14.2%). They fell most in Cape Coral, FL (-2.7%), Honolulu (-2.1%)
and Austin, TX (-1.1%).
- Price cuts: In Indianapolis, 48.1% of listings had a
price drop—a higher share than any other metro Redfin analyzed.
Next came Tampa, FL (45.2%) and Denver (44.8%). The lowest shares
were in Newark, NJ (13.4%), Lake County, IL (15%) and Milwaukee
(15.2%). Note: Three of the 10 metros with the highest shares of
price drops are in Florida and three are in Texas.
- New listings: New listings rose most in San Jose, CA
(32.7%), Seattle (31.2%) and Denver (31.1%). They fell most in
Atlanta (-7.7%), New Orleans (-4.4%) and Greensboro, NC
(-4.3%).
- Active listings: Active listings rose most in North
Port, FL (51.1%), Tampa (46%) and Cape Coral (45.1%). They fell
most in New Brunswick, NJ (-8.1%), Chicago (-7.3%) and Raleigh, NC
(-5.5%).
- Closed home sales: Home sales rose most in San Jose
(16.6%), Minneapolis (11.7%) and San Francisco (10.5%). They fell
most in Stockton, CA (-15.4%), Buffalo, NY (-15.3%) and San Antonio
(-14.3%).
- Sold above list price: In Rochester, NY, 77.1% of homes
sold above their final list price, the highest share among the
metros Redfin analyzed. Next came San Jose (76.1%) and Oakland, CA
(68.4%). The shares were lowest in North Port (5.9%), West Palm
Beach, FL (8.1%) and Cape Coral (8.6%).
To view the full report, including charts, please visit:
https://www.redfin.com/news/home-sales-fall-to-near-record-low
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.
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version on businesswire.com: https://www.businesswire.com/news/home/20240614622273/en/
Redfin Journalist Services: Kenneth Applewhaite
press@redfin.com
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