Today's Headlines - Realty Times
Posted On Monday, 22 April 2024 11:10
Posted On Monday, 22 April 2024 08:50 Written by

Luxury sales are outperforming partly because elevated mortgage rates aren’t a deterrent for many luxury buyers, as a record 47% of luxury homes were bought in cash at the start of 2024

The median-priced U.S. luxury home sold for a record $1,225,000 in the first quarter, up 8.7% from a year earlier, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Prices of non-luxury homes rose at roughly half the pace; they were up 4.6% to a median of $345,000, also a record high.

Redfin defines luxury homes as those estimated to be in the top 5% of their respective metro area based on market value, and non-luxury homes as those estimated to be in the 35th-65th percentile based on market value.

Luxury prices are rising largely because demand for high-end homes has held up better than demand for middle-of-the-road homes. Sales of luxury homes are on the upswing, partly because many high-end buyers are undeterred by high mortgage rates, with the share of luxury homes bought in cash sitting at record highs. New listings of luxury homes are soaring—but not enough to curb the price growth that comes with rising demand; the total supply of luxury homes is still far below pre-pandemic levels.

“People with the means to buy high-end homes are jumping in now because they feel confident prices will continue to rise,” said David Palmer, a Redfin Premier agent in the Seattle metro, where the median-priced luxury home sells for $2.7 million. “They’re ready to buy with more optimism and less apprehension. It’s a similar sentiment on the selling side: Prices continue to increase for high-end homes, so homeowners feel it’s a good time to cash in on their equity. Even though mortgage rates remain elevated and demand isn’t as high as it was during the pandemic, many homebuyers and sellers feel the worst of the housing downturn is behind us.”

Luxury home sales rise for first time since 2021 as record share of affluent buyers pay cash

Sales of luxury homes rose 2.1% year over year in the first quarter. Luxury sales started posting year-over-year increases in January for the first time since August 2021.

Sales of non-luxury homes decreased 4.2% year over year. Non-luxury sales haven’t posted an increase since the end of 2021.

Sales are growing for luxury homes and declining for non-luxury homes largely because so many affluent buyers are able to pay in cash, meaning today’s elevated mortgage rates don’t deter them from purchasing homes. Nearly half (46.8%) of luxury homes bought during the three months ending February 29 were purchased in cash. That’s the highest share in at least a decade and up from 44.1% a year earlier.

The weekly average 30-year fixed mortgage rate has hovered between 6.6% and 7% since the beginning of 2024, more than double pandemic-era record lows. Elevated mortgage rates have driven down demand for the average American homebuyer, but rates are irrelevant to cash buyers.

Supply of luxury homes for sale posts biggest year-over-year increase on record

The total number of luxury homes for sale rose 12.6% from a year earlier in the first quarter, the biggest increase on record. That’s compared with a 2.9% decline in non-luxury inventory.

New listings of luxury homes soared 18.5% from a year earlier in the first quarter, the second consecutive quarter of double-digit increases. That’s roughly seven times bigger than the 2.7% increase for non-luxury homes.

Supply of luxury homes is shooting up for several reasons. One, the mortgage-rate lock-in effect has a lesser impact on luxury homeowners because they’re more apt to buy their next home in cash or be in a financial position to take on a higher rate. Two, owners of luxury homes, many of whom have a lot of equity, are putting their houses on the market to cash in while prices are at record highs. Three, luxury supply had a lot of room to grow, as it was sitting at low levels during the first quarter of 2023.

It’s worth noting that while luxury inventory is on the rise, total supply and new listings are below typical pre-pandemic first-quarter levels. Relatively low inventory is one reason luxury prices are increasing.

Metro-Level Luxury Highlights: Q1 2024

Redfin’s metro-level luxury data includes the 50 most populous U.S. metros. Some metros are removed from time to time, to ensure data accuracy. All changes noted below are year-over-year changes.

  • Prices: The median sale price of luxury homes rose most in Providence, RI (16.2% increase to $1,400,000), New Brunswick, NJ (15% increase to $1,900,000) and Virginia Beach, VA (12.8% increase to $1,100,000). It fell in just eight metros, with the biggest declines in New York (-9.9% to $3,250,000), Austin, TX (-6.9% to $1,629,300) and Minneapolis (-2% to $975,000).
  • Sales: Luxury home sales rose in just over half the metros. They increased most in Seattle (36.9%), Austin, TX (25.5%) and San Francisco (23.9%). They decreased most in Newark, NJ (-23.6%), Philadelphia (-23%) and Detroit (-19.4%).
  • Active listings: The total number of luxury homes for sale increased most in Austin, TX (40.5%), Jacksonville, FL (35.9%) and Fort Worth, TX (32%). Total inventory fell in 15 metros, with the biggest declines in Detroit (-16.8%), Atlanta (-14.1%) and Chicago (-13%).
  • New listings: New listings of luxury homes increased most in Jacksonville, FL (63.6%), Fort Worth, TX (41.7%) and Nassau County, NY (40.5%). New listings fell in eight metros, with the biggest declines in Detroit (-17%), Atlanta (-8.2%) and Chicago (-7.7%).
  • Speed of sales: Luxury homes sold fastest in Seattle, Oakland, CA and San Jose, CA with median days on market of 9, 12 and 12, respectively. They sold slowest in Miami (118 days), Austin, TX (106) and Nashville, TN (104).

10 Most Expensive U.S. Home Sales: Q1 2024

  1. Miami, FL (Surfside): $48M
  2. Seattle, WA (Medina): $38.9M
  3. Los Angeles, CA (Malibu): $38.5M
  4. Glenwood Springs, CO (Aspen): $37M
  5. Santa Maria, CA (Santa Barbara): $36.8M
  6. Hilton Head Island, SC (Yemassee): $35M
  7. Glenwood Springs, CO (Aspen): $33.5M
  8. West Palm Beach, FL (Lantana): $32.5M
  9. Santa Maria, CA (Santa Barbara): $32M
  10. Nashville, TN (Nashville): $32M

To view the full report, including charts and a full metro-level breakdown, please visit: https://www.redfin.com/news/q1-2024-luxury-report/

Posted On Sunday, 21 April 2024 06:24 Written by

We all know that you can’t fight the FED, but when the FED doesn’t do what people want them to do, the markets are the ones that respond! We spoke a couple of weeks ago about wishing certain people would just keep their mouths shut until AFTER certain actions do or don’t happen. However, we got to see what happens when people get too far out in front of a story, or just downright say things that aren’t true. Here are a few issues that were front and center.

•  The FED didn’t cut rates.

•  Inflation isn’t going lower.

•  Most of the jobs created were part-time jobs.

•  The actual number of full-time workers has gone down.

•  Mortgage rates didn’t go to 5% in March.

•  Home prices continue to rise.

•  What happens when CPI/PPI show stress and your leadership says “Don’t” and they DO?

•  The NAR agreement has yet to be signed off on by a judge.

•  While some of the mortgage agencies have made their voice heard on what happens when sellers pay buyer’s agents, there are still some that have yet to weigh in.

•  Let’s not even get started with 50 states having to approve disclosures, listing agreements, and buyer agency contract language, and get it done by July!

That said, people are still buying houses and taking mortgage loans to do it. Mortgage rates are still lower than historical averages and in some parts of the country we are seeing the return of multiple offers and offers well over list price to secure the deal. It’s important to stay on top of the FACTS of the matter and be prepared to execute your success strategies because it's helping people navigate the process that gets you paid!

Questions or comments: This email address is being protected from spambots. You need JavaScript enabled to view it.

Posted On Monday, 22 April 2024 00:00 Written by

Daily average mortgage rates jumped to their highest level since last November after last week’s disappointing inflation report

The median U.S. home-sale price increased 5% from a year earlier during the four weeks ending April 14, bringing it to $380,250—just $3,095 shy of June 2022’s all-time high. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

The average daily mortgage rate this week surpassed 7.4%, the highest level since last November, after a hotter-than-expected inflation report and the Fed’s confirmation that interest-rate cuts will be delayed. The combination of high mortgage rates and prices have brought homebuyers’ median monthly housing payment to a record $2,775, up 11% year over year.

There are signals that buyers are out there touring homes despite rising rates. Mortgage-purchase applications are up 5% week over week, and Redfin’s Homebuyer Demand Index—a measure of requests for tours and other buying services from Redfin agents—is near its highest level in seven months. Chen Zhao, Redfin's economic research lead, said some house hunters are hoping to buy now because they're concerned rates could rise more, and others have grown accustomed to elevated rates and pushed down their home-price budget accordingly.

“Home sales are slower than usual, but there are still people buying and selling because if not now, when?” said Connie Durnal, a Redfin Premier agent in Dallas. “I’ve had a few prospective buyers touring homes for the last several years, since mortgage rates started going up, and they wish they would have bought last year because prices and rates are even higher now. My advice to them: If you can afford to and you find a house you love, buy now. There’s no guarantee that rates will come down soon.”

For more of Redfin economists’ takes on the housing market, including 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

7.41% (April 17)

Up from 7% one month earlier; highest level since November 2023

Up from 6.61%

Mortgage News Daily

Weekly average 30-year fixed mortgage rate

6.88% (week ending April 11)

Up just slightly from 6.82% a week earlier

Up from 6.27%

Freddie Mac

Mortgage-purchase applications (seasonally adjusted)

 

Increased 5% from a week earlier (as of week ending April 12)

Down 10%

Mortgage Bankers Association

Redfin Homebuyer Demand Index (seasonally adjusted)

 

Up 8% from a month earlier (as of week ending April 14)

Down 11%

Redfin Homebuyer Demand Index, a measure of requests for tours and other homebuying services from Redfin agents

Touring activity

 

Up 33% from the start of the year (as of April 14)

At this time last year, it was up 23% from the start of 2023

ShowingTime, a home touring technology company

Google searches for “home for sale”

 

Unchanged from a month earlier (as of April 14)

Down 17%

Google Trends

Key housing-market data

U.S. highlights: Four weeks ending April 14, 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
April 14, 2024

Year-over-year
change

Notes

Median sale price

$380,250

4.7%

 

Median asking price

$413,225

6.4%

Biggest increase since Oct. 2022; all-time high

Median monthly mortgage payment

$2,775 at a 6.88% mortgage rate

10.6%

All-time high

Pending sales

86,086

-2.3%

 

New listings

93,332

10.8%

 

Active listings

832,748

9.6%

 

Months of supply

3.3 months

+0.4 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

42.6%

Down from 44%

 

Median days on market

35

-1 day

 

Share of homes sold above list price

29.2%

Essentially unchanged

 

Share of homes with a price drop

5.9%

+1.6 pts.

 

Average sale-to-list price ratio

99.2%

+0.2 pts.

 

Metro-level highlights: Four weeks ending April 14, 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 (24.8%)

Providence, RI (14.6%)

Nassau County, NY (14.3%)

West Palm Beach, FL (13.5%)

New Brunswick, NJ (13.1%)

San Antonio, TX (-1%)

Declined in just 1 metro

Pending sales

San Jose, CA (25.6%)

San Francisco (11.2%)

Oakland, CA (7.1%)

Columbus, OH (6.7%)

Seattle (6.4%)

Nassau County, NY (-14.9%)

Atlanta (-13.6%)

Houston (-11.6%)

Riverside, CA (-10.8%)

Fort Lauderdale, FL (-10%)

Increased in 14 metros

New listings

San Jose, CA (46.6%)

Sacramento, CA (27.6%)

Phoenix (27.4%)

Jacksonville, FL (27.2%)

Dallas (22.9%)

Newark, NJ (-12.4%)

Providence, RI (-6.3%)

Milwaukee (-4.6%)

Chicago (-4.5%)

Detroit (-3.1%)

Declined in 9 metros

To view the full report, including charts, please visit:
https://www.redfin.com/news/housing-market-update-home-prices-mortgage-rates-increase

Posted On Friday, 19 April 2024 03:30 Written by
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