Rising Interest Rates Boost End-of-Season Home Buyers
In an unusual move, home prices and the rate they are selling at both rose in October, counteracting trends that typically see a cooling during this time of year.
According to a new report from Red tuna, the median selling price of a home in October rose to $ 357,007, an increase of 1.5% from last month and an increase of 13% from a year ago.
The asking price of newly listed homes also rose 12% year-on-year to $ 357,381. Compared to pre-pandemic figures, the asking price for a newly listed home has increased 27% since 2019.
Mortgage rates, although rising in recent weeks, fell to 3.09% for the week ending Nov. 4, prompting buyers and refinancers to take advantage of low rates before they rebound.
“Rising mortgage rates have started a fire under many homebuyers,” said Redfin chief economist Daryl Nice weather. âFear of Missing Out (FOMO) is still a powerful force in this supply-constrained housing market, but especially today for buyers who were unable to purchase a home last year before mortgage payments only increase 15%. With this renewed FOMO, the housing market is heating up after the slight lull of a few months ago.
The report, written by Redfin Economist Tim Ellis, also found:
- Pending home sales increased 5% year on year and 51% compared to the same period in 2019.
- New listings of homes for sale were down 7% from the previous year, but up 8% from 2019.
- Active listings (the number of homes listed for sale at any time during the period) decreased 22% from 2020 and 40% from 2019.
- 45% of homes under contract had an accepted offer within the first two weeks on the market, above the 41% rate a year earlier and the 30% rate in 2019. As of the four week period ending September 19, the share of housing under contract within two weeks is up 1.6 percentage points. During the same period in 2019, the share fell by 1.2 points.
- 33% of homes under contract had an offer accepted within a week of going on the market, up from 29% in the same period a year earlier and 19% in 2019. As of the four week period ending on the 12th September, the share of homes under contract in the week is up 2.6 percentage points. During the same period in 2019, the share fell by 1.2 points.
- Homes that sold were on the market for a median of 23 days, a full week longer than the historic 16-day low seen in late June and July, down from 31 days a year earlier and 45 days in 2019.
- 45% of homes sold above the list price, up from 35% a year earlier and 22% in 2019.
- On average, 4.7% of homes for sale each week saw price decline, up 1.1 percentage points from the same period in 2020, up 0.1 percentage point from 2019.
- The average sale-to-list price ratio, which measures how well homes are selling for their asking prices, was stable at 100.6%. In other words, the average home has sold 0.6% above its asking price.
- From Jan. 1 to Oct. 31, home visits increased 0.2%, up from a 9% increase over the same period last year, but larger than the -2% change in 2019, according to the home visiting technology company. Time display.
- Mortgage purchase requests were down 2% week-over-week (seasonally adjusted) in the week ending October 29.