Home buyers are regaining their voice in a market that had been unilaterally controlled by sellers not too long ago. With more inventory and some price drops, buyers are again “important.”
Housing Market No Longer Heating Up
Home sellers are no longer completely in control of the housing market. The number of offers on a for-sale home is falling as is the number of bidding wars. The share of for-sale homes with a price drop increased to 4.9%, a level last seen in 2019. For-sale inventory is increasing as are the number of days a for-sale home stays on the market.
And, by the way, asking prices have eased back from the-sky’s-the-limit to where they were in May 2021 despite being bid up to premiums above list.
Buyer Not Feeling Frenzied Rush to Buy
According to Redfin’s Chief Economist Daryl Fairweather, “For the first time in over a year, homebuyers don’t need to feel rushed. Though the market still feels tight and competitive, the number of homes for sale keeps creeping up as more homes are listed. Those home sellers are adjusting their price expectations or seeing their homes sit on the market.”
Fairweather added, “There could be even more listings coming on the market as mortgage forbearance ends and homeowners with missed payments decide to sell. And mortgage rates remain near all-time lows with no signs of an increase on the horizon.”
Key Market Takeaways for 4-Week Period Ending August 8
- The median home sale increased +17% y/y to a record high of $362,842.
- Asking prices of newly listed homes increased +11% y/y to a median price of $355,389. This is the lowest since early May.
- Pending sales were up +5% y/y, the smallest increase since the 4-week period ending May 30. This is also a faster decrease in pending sales since 2019.
- New listings increased +0.2% y/y, a typical seasonal decline of new listings.
- Active listings fell -25% y/y, the smallest decline since the 4-week period ending December 6, 2020, and +15% higher since the 2021 low during the 4—week period ending March 7.
- 53% of homes sold above list, down from its peak of July 11 when 55% of homes sold above list. The average home sold for 1.9% over list price.
- Share of homes with price drops up +4.9% which was on a par with 2019 levels.
- During the week ending August 12, mortgage purchase applications rose +2.87%.
Thanks to Redfin.