Redfin Reports Rising Mortgage Rates Haven’t Yet Slowed Pending Sales

Published 2 months ago via Business Wire

Pending home sales posted their biggest increase since 2021 this week, but some house hunters are starting to pull back

(NASDAQ: RDFN) — Pending U.S. home sales rose 3.2% year over year during the four weeks ending October 13, the biggest increase in three years, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

Home sales are rising. On a local level, pending sales are up in 34 of the 50 most populous U.S. metros, with the biggest increases in California and in Portland, OR. Sales have improved over the last month because mortgage rates fell to a two-year low at the end of September amid the Fed’s highly anticipated interest-rate cut. Please note that Redfin is comparing to a period in 2023 when sales slumped as mortgage rates approached a two-decade high.

Mortgage rates are rising. Mortgage rates have ticked up over the last few weeks, largely due to a stronger-than-expected jobs report on October 4: The weekly average 30-year rate is 6.32%, compared to 6.08% during the last week of September. Home prices are also rising, with the median sale price posting a 4.7% year-over-year increase, the biggest uptick since March. That has pushed the typical homebuyer’s monthly payment up nearly $100 from a month ago.

Home tours and mortgage-purchase applications have flattened out. Rising rates have slowed demand somewhat at earlier stages of the homebuying process. Some would-be buyers seem to be waiting for rates to come back down: Redfin’s Homebuyer Demand Index—a measure of tours and other buying services from Redfin agents—has fallen marginally from the six-month high it hit two weeks ago, though it is up 7% year over year. And mortgage-purchase applications are down 7% week over week, but they are still trending up from a year ago.

Sellers are taking a small step back as rates rise: New listings are up 3.6% nationwide, the smallest year-over-year increase in a month.

“So far, higher rates haven’t slowed buyers down in the Minneapolis area. But buyers are negotiating more heavily than they have in years, trying to shave money off the home price because they’re taking on a pretty high rate,” said Emily Olson, a Redfin Premier agent in Minneapolis. “It’s a good strategy, because sellers are receptive to it. Sellers know every buyer taking on a mortgage is contending with high rates, and they would rather get their house sold now than let it linger on the market going into the holiday season.”

For Redfin economists’ takes on the housing market, 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

6.63% (Oct. 16)

Near highest level in 3 months

Down from 7.69%

Mortgage News Daily

Weekly average 30-year fixed mortgage rate

6.32% (week ending Oct. 10)

Up from 2-year low of 6.08% 2 weeks earlier

Down from 7.57%

Freddie Mac

Mortgage-purchase applications (seasonally adjusted)

 

Down 7% from a week earlier (as of week ending Oct. 11)

Up 7%

Mortgage Bankers Association

Redfin Homebuyer Demand Index (seasonally adjusted)

 

Up 6% from a month earlier (as of week ending Oct. 13)

Up 7%

 

Biggest increase in over a year

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

Touring activity

 

Down 2% from the start of the year (as of Oct. 13)

 

At this time last year, it was down 12% from the start of 2023

ShowingTime, a home touring technology company

Google searches for “home for sale”

 

Up 4% from a month earlier (as of Oct. 13)

Down 4%

 

Google Trends

Key housing-market data

U.S. highlights: Four weeks ending Oct. 13, 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 Oct. 13, 2024

Year-over-year change

Notes

Median sale price

$384,412

4.7%

Biggest increase since March

Median asking price

$399,675

6%

Biggest increase in 2 years

Median monthly mortgage payment

$2,566 at a 6.32% mortgage rate

-4.5%

Up from $2,489 a month earlier

Pending sales

76,447

3.2%

Biggest increase in nearly 3 years

New listings

85,943

3.6%

 

Active listings

1,024,565

16%

Smallest increase since March

Months of supply

4

+0.6 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

33.8%

Down from 39%

 

Median days on market

39

+6 days

 

Share of homes sold above list price

26%

Down from 30%

 

Average sale-to-list price ratio

98.8%

-0.3 pts.

 

Metro-level highlights: Four weeks ending Oct. 13, 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

Fort Lauderdale, FL (11.2%)

Milwaukee (10.7%)

Providence, RI (10.1%)

Chicago (10.1%)

Nassau County, NY (10.1%)

Austin, TX (-4.6%)

San Antonio (-1.7%)

Nashville, TN (-0.6%)

Tampa, FL (-0.5%)

Fort Worth, TX (-0.1%)

Declined in 5 metros

Pending sales

Portland, OR (17.8%)

Los Angeles (16%)

Anaheim, CA (15.7%)

San Jose, CA (15.5%)

Seattle (14.4%)

 

Tampa, FL (-27.5%)

West Palm Beach, FL (-18.4%)

Fort Lauderdale, FL (-14.5%)

Miami (-13.8%)

Orlando, FL (-12%)

Increased in 34 metros

 

The last time pending sales increased in this many metro areas was in May 2021

New listings

San Jose, CA (22.2%)

Phoenix (19.5%)

Sacramento, CA (18.1%)

Seattle (17.9%)

Baltimore, MD (16%)

 

Tampa, FL (-36.1%)

Atlanta (-17.3%)

West Palm Beach, FL (-13.2%)

Orlando, FL (-12%)

Fort Lauderdale, FL (-6.9%)

Declined in 11 metros

To view the full report, including charts, please visit:

https://www.redfin.com/news/housing-market-update-rising-mortgage-rates-pending-sales-holding-up

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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