U.S. home prices are down 2.7%, the smallest decline in over a month, and prices are dropping in fewer metros
The median U.S. home-sale price fell 2.7% during the four weeks ending May 14, the smallest decline in over a month. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.
Monthly mortgage payments hit a record high due to still-high prices and elevated mortgage rates. On a local level, home prices are declining in 28 of the 50 most populous U.S. metros, down from a high of 32 metros at the end of April.
That’s a reflection of a mismatch between demand and supply propping up prices. Pending home sales are down 15% from a year earlier, but that’s much smaller than the 24% decline in new listings.
Today’s elevated mortgage rates continue to discourage homeowners from selling; nearly all of them have a mortgage rate below 6%, while this week’s average 30-year rate was 6.39%. The dearth of new listings has drained inventory, with the total number of homes for sale dropping over the past two months, going against typical seasonal trends.
The share of homes selling that are doing so within two weeks (48%) is also bucking seasonal trends, illustrating urgency from buyers who don’t have much to choose from. That share has steadily increased over the last two months, while it typically falls this time of year.
“High mortgage rates continue to dictate the housing market. Although a lot of homebuyers have acclimated to rates in the 6% range and many are finding ways to lower their monthly payments, like using a 2-1 buydown, high rates are handcuffing potential sellers,” said Redfin Deputy Chief Economist Taylor Marr. “It’s hard to imagine a flood of new listings until rates come down at least into the 5s. For those who are selling now, the silver lining of giving up a low rate is that hardly anyone else is doing the same thing. That means buyers, who are hungry for new listings, will bite—and they don’t have much power to negotiate the price down.”
Newly built homes could help alleviate the inventory shortage even if rates remain elevated, and there are signs more may be coming. U.S. homebuilder confidence rose for the fifth straight month in May, hitting its highest level in nearly a year, and permits for single-family homes rose to a seven-month high in April.
Housing-market trends are playing out differently in different parts of the country, but agents in most metros are reporting that demand is outpacing supply. In Boise, ID, which had one of the hottest markets in the country during the pandemic, Redfin Premier agent Shauna Pendleton says today’s buyers are having a hard time finding homes because homeowners are sitting on 3% mortgage rates and aren’t moving unless they’re leaving the state.
“I’m practically begging potential sellers to list, especially those in the more affordable price point because those are the homes buyers are hungry for,” Pendleton said. “Every listing I’ve had since January priced at under $400,000 has had multiple offers within a few days on the market. I listed a home at the end of April at $399,900 and we ended up with four offers by the fourth day; it ended up going for $10,000 over list price. I even listed one at $650,000 that got multiple offers and went pending in under 48 hours.”
In Fort Lauderdale, FL, home prices are up 9% year over year, more than anywhere else in the U.S. except Milwaukee. Redfin team manager Andrea Duke said Fort Lauderdale prices are holding up well because South Florida is a popular destination. “There’s almost always demand for this area because people move here for the weather, and a lot of them pay in cash,” Duke said. “If a home is priced well and it’s in great shape, the seller will get multiple offers. But the market isn’t quite as hot as it was last year; most buyers are still including contingencies in their offers.”
Leading indicators of homebuying activity:
Key housing market takeaways for 400+ U.S. metro areas:
Unless otherwise noted, this data covers the four-week period ending May 14. Redfin’s weekly housing market data goes back through 2015. For bullets that include metro-level breakdowns, Redfin analyzed the 50 most populous U.S. metros. Select metros may be excluded from time to time to ensure data accuracy.
To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-update-fewer-metros-home-price-declines-low-inventory
Jim Fite is an accomplished entrepreneur, sales professional and business owner with decades of experience. His journey began when he started his first business at the young age of 18. Since then, Jim has created, led and participated in multiple organizations. These organizations include companies, boards and non-profits. Through his involvement in these ventures, Jim has gained a wealth of knowledge and expertise in business management, sales and entrepreneurship.
Today, Jim is a sought-after speaker who has delivered inspiring talks to thousands of businesses and sales professionals across the United States. He is also a coach, mentor and consultant to many successful business owners, helping them achieve their goals and reach new heights of success.
Jim's most significant achievement is his role in Judge Fite Company, which he purchased with his sister, Jan Fite Miller. What began as a small real estate company with eight people has since grown into a diversified enterprise with multiple successful companies employing more than 1,200 people and independent contractors.
Jim's philosophy of setting goals to "succeed" rather than "survive" is a testament to his passion for helping others succeed. He firmly believes that opportunities for those who follow are endless and is committed to sharing his knowledge and experience to help others achieve their success. Jim's expertise and passion for helping others have made him a highly respected and influential figure in the business world.
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