According to the report from “Realtor” on September, this year’s prime home buying period is set to be from October 12th to the 18th. The latest report released by Redfin on October 9th seems to validate this prediction, suggesting that buyers looking for better deals may consider condominiums or newly built homes.
Redfin data shows that in the four-week period leading up to October 5th, the number of newly listed homes in the United States increased by 2.3% compared to the previous year, marking the most significant growth in three months. Additionally, the average mortgage interest rate for the month of September dropped to 6.26%, reaching a low point in nearly 10 months.
Despite the increase in listings, the sales side did not see a significant uptick. The number of pending sales dropped by 1.3%, marking the largest decline in five months. The typical time it takes for a listed home to go under contract extended to 48 days, one week longer than the same period last year.
Some key indicators highlighted in the Redfin report include:
– Median home price at $389,350, up 2.1% year-over-year (largest increase in six months)
– Median list price at $401,242, up 2% year-over-year
– 91,338 newly listed homes, up 2.3% year-over-year
– 79,690 pending sales, down 1.3% year-over-year
– Total housing inventory at 1,212,765, up 8.0% year-over-year
– Average time from listing to sale at 48 days
– Percentage of homes selling above list price decreased to 23.2% (down from 26% in the same period last year)
– Sales-to-list price ratio at 98.4% (down from 98.8% in the same period last year)
The report also outlined performance disparities in some metropolitan areas, with cities like Detroit, Cleveland, Providence, San Jose, and Cincinnati experiencing significant annual price increases, while Dallas, Austin, Houston, Atlanta, and Tampa saw declines in median sales prices. Certain cities like Washington D.C., Pittsburgh, Philadelphia, and Detroit saw noticeable year-over-year increases in new listings.
Real estate agents in some Redfin regions noted that buyers are waiting for further interest rate drops before making a move. The mortgage rate slightly increased from its recent low of 6.34% last month, but remains more than double the low point during the pandemic. Median home prices rose by 2.1% year-over-year, marking the largest increase in six months.
Agents on the market front line pointed out that high prices and economic uncertainties such as government shutdown risks and weak jobs reports are causing hesitation among potential buyers.
In such an environment, sellers eager to make a sale are facing significant negotiation pressure. Some homeowners have had to reduce prices or offer additional incentives like furniture, outdoor equipment, etc., to facilitate transactions. For instance, a homeowner listed their property for over 100 days before eventually selling at a $15,000 discount with added furniture and outdoor amenities.
Agents suggest that buyers looking for more discounts could consider shifting their focus to condominiums or newly built homes to broaden their opportunities. Currently, the nationwide ratio of condominium sellers to buyers is 72%, making it relatively the highest among all types of housing.
Furthermore, in areas where there are more new construction homes, builders are offering mortgage rate subsidies (rate buydowns) or other promotional conditions to drive sales.