Home sellers are slashing asking prices with record clip Soaring mortgage interest rates A recent report from real estate firm Redfin has caused a downturn in the US housing market.
About 7.9% of home listings reported price declines in the four weeks ending Oct. 9, according to the rolling average. Compiled by RedfinThe figure marks a record high and a significant increase compared to the same period last year, when only 4% of listings reported price cuts.
“Home buyers and sellers had little time to get used to 5.5% mortgage rates over the summer before it rose to nearly 7% this month,” said Taylor Ma, deputy chief economist at Redfin. ‘ said.
“The second sharp rate hike of the year, combined with inflation and nervousness about the direction of the economy, has pulled home sales activity even lower than it did in the summer and pushed homebuyer sentiment to near all-time lows,” Ma said. added. .
Buying activity in the once highly frenetic U.S. housing market has slowed significantly as rising mortgage rates have made it more difficult to buy a home. The average interest rate on 30-year fixed-rate mortgages last week was 6.92%, according to Freddie Mac, more than double his rate for the same week a year ago.
Based on current median home asking prices and an average long-term mortgage rate of 6.92%, buyers face a record monthly mortgage payment of $2,559, according to Redfin’s calculations.
Mortgage payments are 51% higher than this time last year, when buyers could expect to pay $1,698 per month at a 3.05% mortgage rate.
The number of pending home sales is down 28% compared to last year, the steepest drop since the COVID-19 pandemic hit in May 2020.
The median asking price for newly listed homes has fallen 1% over the past four weeks, but rose 9% last year to $379,725.
Redfin created the report based on data from over 400 US metropolitan areas.
Mortgage rates surged as the Federal Reserve raised its benchmark interest rate to combat inflation. Mortgage rates aren’t directly affected by his Fed’s benchmarks, but tend to rise as central banks tighten monetary policy.
as the post reportedhouse prices have started to fall sharply in some markets.
According to Black Knight’s July Mortgage Monitor report, median US home prices fell 0.77% from June to July.The number was the highest since the previous month Declining house values From January 2011.