Pending Home Sales Rise, Breaking Six Month Spiral

Pending home sales rose for the first time since May, breaking a six-month streak of declines, according to the National Association of Realtors. The Pending Home Sales Index increased by 2.5% between November and December. Year-over-year it dropped by 33.8%, an improvement over November’s 37%. All four regions saw pending sales fall YOY, but the South and West saw gains month-over-month. “This recent low point in home sales activity is likely over,” said NAR Chief Economist Lawrence Yun. “Mortgage rates are the dominant factor driving home sales, and recent declines in rates are clearly helping to stabilize the market.” Mortgage rates fell again last week to 6.13%, drawing some buyers back to the market. Purchase loan applications increased again as…

Existing Home Sales Slipped In December

Existing-home sales dropped for the eleventh straight month in December, down 1.5% from November and 34% YOY, according to the latest data from the National Association of Realtors. Sales fell to a seasonally adjusted annual rate of 4.02 million from 4.09 million the month prior. Three of the four major regions saw declines month-over-month, though the West’s sales were unchanged from November. All four regions saw annual declines. “December was another difficult month for buyers, who continue to face limited inventory and high mortgage rates,” said NAR Chief Economist Lawrence Yun.  “However, expect sales to pick up again soon since mortgage rates have markedly declined after peaking late last year.” The 30-year fixed rate fell to 6.15% last week. Limited…

Consumer Sentiment Sees A Boost As Rates, Prices Moderate

Homebuyers are feeling slightly more optimistic about the market as mortgage rates ease. Fannie Mae’s Home Purchase Sentiment Index (HPSI) rose 3.7 points in December. Three of its six components improved from the month prior as more consumers said they expect rates and home prices to drop. After weeks of declines, rates inched up in the first week of 2023 but remain well below 7%. Economists at Freddie Mac expect them to fall further as inflationary pressures ease. But home purchase sentiment remains near its all-time low, set in October, and is down 13.2 points YOY. Only 21% of respondents believe it’s a good time to buy a home. And the possibility of additional rate hikes from the Federal Reserve…

Home Sales See Biggest YOY Drop On Record

Home sales plummeted by 35% in November but there are early signs that demand may be picking up. Redfin’s latest data found that home sales dropped 35.1% YOY in November on a seasonally-adjusted basis. High buying costs kept both buyers and sellers on the sidelines. “Rates have declined significantly over the past six weeks, which is helpful for potential homebuyers, but new data indicates homeowners are hesitant to list their homes,” Sam Khater, Freddie Mac’s Chief Economist, noted. “Many of those homeowners are carefully weighing their options as more than two-thirds of current homeowners have a fixed mortgage rate of below four percent.” Sellers have hesitated to put their homes on the market, knowing they’ll have to buy a new…

Existing-Home Sales Continue Declining

Existing-home sales dropped for the tenth straight month in November, down 7.7% from October and 35.4% YOY, according to the latest data from the National Association of Realtors. Sales fell to a seasonally adjusted annual rate of 4.09 million from 4.43 million the month prior. All four major regions saw declines. “In essence, the residential real estate market was frozen in November, resembling the sales activity seen during the COVID-19 economic lockdowns in 2020,” said NAR Chief Economist Lawrence Yun.  “The principal factor was the rapid increase in mortgage rates, which hurt housing affordability and reduced incentives for homeowners to list their homes. Plus, available housing inventory remains near historic lows.” Inventory of unsold homes fell 6.6% from October to…

Here’s What’s Scaring Mortgage Brokers This Halloween

This Halloween, mortgage brokers have more to fear than your typical ghosts and ghouls. Some economists say the market is rebalancing, while others say the housing slowdown is more severe than a correction. “Last year, sellers could seemingly list their home at any price and see multiple offers roll in above list price within days,” said Senior Economist Nicole Bachaud of Zillow. “Now, buyers have some negotiating power, and sellers are under pressure. Buyers are still out there and willing to buy when they find the right home at the right price, which will provide a floor for the price declines we are currently seeing.” Either way, mortgage brokers are facing a seriously spooky situation: dwindling home sales, decades-high interest rates,…

Existing Home Sales Down 1.5% In September

Existing-home sales dropped for the eighth straight month in September, down 1.5% from August and 23.8% YOY, according to the most recent data from the National Association of Realtors. Sales fell to a seasonally adjusted annual rate of 4.71 million and declined in three of the four major regions. The West saw no change. “Despite weaker sales, multiple offers are still occurring with more than a quarter of homes selling above list price due to limited inventory,” said NAR Chief Economist Lawrence Yun.  “The current lack of supply underscores the vast contrast with the previous major market downturn from 2008 to 2010, when inventory levels were four times higher than they are today.” Inventory of unsold homes fell 2.3% from…

Pending Home Sales Down For Third Month

Pending home sales fell for a third consecutive month in August, with three of the four regions seeing month-over-month declines, according to the National Association of Realtors. The Pending Home Sales Index dropped by 2% between July and August. Year-over-year it tanked by 24.2%. All four regions saw pending sales drop year-over-year. The West, however, experienced a small uptick month-over-month, up by 1.4%. The Northeast PHSI fell by 3.4% from July, while the South fell 0.9% and the Midwest dipped by 5.2%. “The direction of mortgage rates – upward or downward – is the prime mover for home buying, and decade-high rates have deeply cut into contract signings,” said NAR Chief Economist Lawrence Yun. “If mortgage rates moderate and the…

Luxury Home Sales See Biggest Dip Since 2012

Luxury home sales tanked by 28.1% YOY in the three months ending August 31, the biggest drop since 2012, according to new Redfin data. The decline overtook even the 23.2% drop that happened at the beginning of the pandemic, when home sales slowed to a crawl in every area. Non-luxury home sales also fell by the largest margin on record, but in a far less dramatic drop of 19.5%, a change of 0.5%. The same stressors that are beating down the non-luxury market are impacting high-end buyers: low inventory, rising rates, and economic uncertainty. “High-end-house hunters are getting sticker shock when they see the impact of rising mortgage rates on paper. For a luxury buyer, a higher interest rate can…

Existing Home Sales Down 0.4% In August

Existing-home sales dropped for the seventh straight month in August, down 0.4% from July and 19.9% YOY, according to the National Association of Realtors’ most recent data. Sales fell to a seasonally adjusted annual rate of 4.80 million and declined in every major region. Inventory of unsold homes fell 1.5% from July to 1.28 million, breaking a five-month streak of increases. This is a 3.2 months supply at the current sales pace. “The housing sector is the most sensitive to and experiences the most immediate impacts from the Federal Reserve’s interest rate policy changes,” said NAR Chief Economist Lawrence Yun.  “The softness in home sales reflects this year’s escalating mortgage rates. Nonetheless, homeowners are doing well with near nonexistent distressed…