The National Association of Realtors’ August report on existing home sales provides an overview of how the housing market weathered rising mortgage rates in the late summer.
The NAR releases August home sales data at 10 am Wednesday.
The housing market has slowed in recent months and is expected to remain monthly sales drop Through July — As the Federal Reserve aggressively raise interest rates Cool the economy and keep high inflation under control. This has led to higher mortgage rates, increasing borrowing costs for homebuyers by hundreds of dollars a month and pushing many out of the market.
Average interest rate for a 30-year fixed-rate mortgage 6.02% in the week ending Sept. 15up from 2.86% a year earlier, according to the Housing Finance Agency
As homebuying demand declined, the inventory of homes for sale increased across the United States, lengthening the length of time homes were on the market.
However, the number of homes for sale is still below normal levels. Although home prices have fallen from their spring peaks in some markets, prices are still above his year-ago levels. According to the NAR, median selling prices for existing homes fell from a record $413,800 in June to $403,800 in July, the first monthly drop since January. The August data release could signal another price drop.
Economists surveyed by The Wall Street Journal expect sales of existing homes, which make up the bulk of the housing market, to fall 2.7% monthly in August.
General economic uncertainty is also keeping buyers on the sidelines, according to Deputy Chief Economist Odeta Kushi.
“To make the biggest financial decisions of your life, you need to have some confidence in your economy, your jobs and the labor market,” she said.
Philip Natale signed a deal to buy a new home in Henderson, Nevada in December. By the time he finalized his rate this spring, his rate had risen from about 3% to more than his 5%, pushing up his monthly payments by hundreds of dollars.
“It’s horrible,” he said, but he hopes to refinance the loan at a lower interest rate within the next year or two. would,” he added.
To save money, Natale decided to eat out less and delay buying a car. “I just don’t want to go through the stress of buying a house and adding a car at the same time,” he said.
In the four weeks to September 11, 7.2% of homes on the market each week saw prices drop, up from 3.8% a year earlier, according to real estate brokers.
Homes sold on average 0.5% below final list price, compared to 1.1% above list price a year ago.
Philip Natale; Sandra Dawson
Charlie and Ashley Richards, both 29 years old, began buying their first home in Charleston, South Carolina after learning in June that their rent had increased by $800 a month.
“We entered the market at the right time. It started to slow down a bit,” Richards said. “We’ve had some homes that have been on the market for 30 days, 60 days, and even 90 days.”
They bought a house this month for about 3% less than their asking price. “I’m very excited,” said Richards.
The National Association of Home Builders announced this week that the U.S. homebuilder confidence index fell for the ninth straight month in September, reaching its lowest level since May 2020. did. According to NAHB, about a quarter of builders surveyed said they had cut prices in the past month.
Housing starts, a measure of US housing construction, increased 12.2% from July to August, the Department of Commerce said this week. But residence permits, which could usher in future housing construction, fell by 10%.
He owns The Wall Street Journal and also operates Realtor.com under license from the NAR.
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