Existing-home sales dipped in March after rising the month prior as the housing market remains rate sensitive.
Sales declined by 2.4% to a seasonally adjusted annual rate of 4.44 million from 4.48 million the month prior, according to the latest data from the National Association of Realtors.
Year-over-year, sales are down 22%.
All four major regions saw sales decline year-over-year and three of the four tanked month-over-month. Only the Northeast’s sales were unchanged from February.
The median price for an existing home slid YOY alongside rates, down 0.9% to $375,700. This is just the second YOY decline in years– last month’s dip broke the longest streak on record, 131 consecutive months of price gains.
“Home sales are trying to recover…
Mortgage rates jumped last week, breaking a five-week streak of declines.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.39%, up from 6.27% the week prior.
A year ago at this time, the 30-year FRM averaged 5.11%.
The 15-year fixed-rate mortgage also rose, up to 5.76% from 5.54%. A year ago, it averaged 4.38%.
“For the first time in over a month, mortgage rates moved up due to shifting market expectations,” said Sam Khater, Freddie Mac’s Chief Economist.“Home prices have stabilized somewhat, but with supply tight and rates stuck above six percent, affordable housing continues to be a serious issue for many potential homebuyers. Unless rates drop into the mid five percent range, demand will only…
By Scott Kimbler
Watch for housing sales in 2023 to follow the same pattern from a decade ago.
That’s the prediction of Ed Pinto, Director of the American Enterprise Institute’s Housing Center, during a recent data review. He and Assistant Director Tobias Peter used information from the final months of 2022 and into the first quarter of 2023 to preview the remainder of 2023 and perhaps even into 2024, given current market trends.
Pinto pointed out that Agency Purchase Volume for the final month of 2022 was down 45 percent from the same month in 2021 and 51 percent down from the same month in 2020.
“Based on Optimal Blue date,” Pinto said. “We expect purchase volume in early 2023…
First-time buyers are still living in last year’s housing market thanks to limited affordable inventory, leading to tight competition and soaring prices.
A new report from Zillow found that typical home values for the least-expensive one-third of houses rose by 8% YOY, or $13,000.
In comparison, mid-level homes saw a 3% YOY increase, and the most expensive one-third of houses lost value, experiencing a 1% drop. This is the first loss of value for the top tier since at least 2012.
“Buyers shopping for the least-expensive homes this spring aren’t noticing much difference from the pandemic-era market heat,” said Skylar Olsen, Zillow’s chief economist.
“Competition is fierce, but there aren’t many homes for sale, so buyers should be patient but…
By KIMBERLEY HAAS
Mortgage originations are expected to decline in 2023 as market factors continue to present challenges for those in the industry.
Michael Fratantoni, the Mortgage Bankers Association’s chief economist and senior vice president of research and industry technology, said during a session at the National Advocacy Conference in Washington, DC, this week that after the whirlwind of 2020 and 2021, the residential slowdown which started in 2022 will continue through this year.
“This has been an extraordinarily tough couple of years for mortgage lenders. Origination volume dropped 50% from ’21 to ’22,” Fratantoni said. “We’re forecasting another 20% decline in 2023 to a level of about $1.8 trillion.”
Although the recent banking market uncertainty has not helped, Fratantoni…
Interest rates increased last week for the first time in more than a month, pushing mortgage applications down.
The Mortgage Bankers Association’s weekly survey says the adjusted Market Composite Index – a measure of mortgage loan application volume – decreased by 8.8%, outstripping last week’s 5.3% increase.
Adjusted purchase applications fell by 10%, while the unadjusted index was down 9% from the week before and 36% lower YOY.
The average interest rate for 30-year fixed loans jumped from 6.30% to 6.43% after ticking down consistently since bank failures last month.
MBA Vice President and Deputy Chief Economist Joel Kan noted that an influx of first-time buyers in the market adds to rate sensitivity, as these buyers lack the flexibility of…
Recent bank failures have created another problem for the housing market: lack of credit.
First American’s Potential Home Sales Model– a measure of what a healthy level of home sales should be based on market fundamentals– fell by 2.5% month-over-month in March. Year-over-year, it is down 10.7%, a loss of more than 640,000 sales.
The biggest contributor to the decline was tightening credit standards, First American says. At the beginning of the pandemic, lenders reduced credit due to the increased likelihood of forbearance and delinquency, but it slowly began to ease.
Now, credit is tightening again thanks to banking uncertainty.
“There are fears that the recent bank failures will prompt lenders to be much more conservative with their lending,” said…
Inflation is forcing homeowners to put renovations on the back burner, but most would still rather renovate than move.
Nearly 60% of respondents to a new survey from Discover Home Loans said they are postponing their renovation projects as projects become more expensive than their budgets. Another 26% will reduce the scope of their projects due to increased costs.
But 79% would still rather renovate their current home than purchase a new one. Just under half of respondents said they are no longer interested in buying a home specifically because of rising interest rates.
“Our survey results show that homeowners are still looking to invest in their homes, despite higher home improvement costs. With large amounts of existing home equity…
Zoomers are approaching homeownership from a different perspective than past generations, focusing more on their pets than their romantic partners.
A recent Zillow survey found that Gen Z adults consider a fenced backyard more essential than a double sink in the primary bathroom, a home office for their partner, or a kids’ playroom.
When asked whether it was more important to have a pet-friendly home or a kid-friendly home, features, 10% more Zoomers chose the former. At the same time, almost a full quarter of Gen Z pet owners would move if their home wasn’t working for their pets. Only 12% said the same about their partners’ preferences.
“Young adults may be delaying parenthood, but they’re not putting off pet…
Mortgage rates ticked down again, the fifth straight week of declines.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.27%, down from 6.28% the week prior.
A year ago at this time, the 30-year FRM averaged 5%.
The 15-year fixed-rate mortgage fell from 5.64% to 5.54%. A year ago, it averaged 4.17%.
“Incoming data suggest inflation remains well above the desired level but showing signs of deceleration,” said Sam Khater, Freddie Mac’s Chief Economist. “These trends, coupled with tight labor markets, are creating increased optimism among prospective homebuyers as the housing market hits its peak in the spring and summer.”
First-time buyers particularly are feeling prepared to enter the market.
More than half of respondents to…
