SEATTLE--(BUSINESS WIRE)--(NASDAQ: RDFN)—Nationwide, 6.4% of home sellers cut their asking price during the four weeks ending May 26, on average, the highest share since November 2022. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.
The median asking price dropped roughly $3,000 to $416,623 in the last week, the first decline in six months. Additionally, for-sale supply is growing more stale: Age of inventory (the typical number of days active listings have been on the market) started rising year over year in May for the first time in eight months, hitting a median of 46 days. Together, those metrics suggest sale-price growth could soften in the coming months as persistently high mortgage rates turn off homebuyers. For now, the median-home sale price is up 4.3% year over year to another record high, though sale prices are a lagging indicator because they’re typically negotiated at least a month before a deal closes.
Buyers did get a modicum of relief on housing costs this week. The typical U.S. homebuyer’s monthly housing payment dropped to $2,812, its lowest level in six weeks. Payments are declining because even though sale prices remain at all-time highs, mortgage rates have come down from their peak: The weekly average mortgage rate is 6.94%, the first time it has dipped below 7% since early April. (It’s worth noting that the reprieve in rates may be short-lived; daily average rates started increasing this week after a string of disappointing treasury auctions.)
High costs are dampening demand. Pending sales are down 3.4% year over year, on par with declines over the last month, and mortgage-purchase applications are sitting near their lowest level in six months. Low inventory is another factor pushing down sales. Even though 7.8% more new listings hit the market than during the same period last year, listing growth has been losing momentum for the last few months, leaving buyers with fewer homes to choose from than there typically are in May.
“The market is slower than usual, but well-maintained properties listed for under a million dollars still get multiple offers,” said Christine Chang, a Redfin Premier agent in the Bay Area. “People who are buying right now are typically doing so because they’re having a baby or looking for a more family friendly home. My advice for those buyers is to be open-minded: Consider single-family homes that are a bit outdated but don’t need major renovations, and/or homes in lesser-known, non-trendy neighborhoods. That type of home tends to sit on the market longer, and buyers may be able to avoid competition and get a home for asking price instead of engaging in a bidding war. Buyers who can get by with less space should consider a condo; they’re relatively unpopular right now and many are going under asking price.”
For Redfin economists’ takes on the housing market, including more on how current financial events are impacting mortgage rates, please visit Redfin’s “From Our Economists” page.
Leading indicators
Indicators of homebuying demand and activity |
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|
Value (if applicable) |
Recent change |
Year-over-year change |
Source |
Daily average 30-year fixed mortgage rate |
7.34% (May 29) |
Up from 6.99% 2 weeks earlier, but down from a 5-month high of 7.52% 5 weeks earlier |
Up from 6.95% |
Mortgage News Daily |
Weekly average 30-year fixed mortgage rate |
6.94% (week ending May 23) |
Down from 5-month high of 7.22% 3 weeks earlier |
Up from 6.57% |
Freddie Mac |
Mortgage-purchase applications (seasonally adjusted) |
|
Declined 1% from a week earlier (as of week ending May 24) |
Down 10% |
Mortgage Bankers Association |
Redfin Homebuyer Demand Index (seasonally adjusted) |
|
Down 7% from a month earlier to lowest level in 3 months (as of week ending May 23) |
Down 12% |
Redfin Homebuyer Demand Index, a measure of requests for tours and other homebuying services from Redfin agents |
Touring activity |
|
Up 10% from the start of the year (as of May 27) |
At this time last year, it was up 12% from the start of 2023 |
ShowingTime, a home touring technology company |
Google searches for “home for sale” |
|
Unchanged from a month earlier (as of May 28) |
Down 14% |
Google Trends |
Key housing-market data
U.S. highlights: Four weeks ending May 26, 2024 Redfin’s national metrics include data from 400+ U.S. metro areas, and is based on homes listed and/or sold during the period. Weekly housing-market data goes back through 2015. Subject to revision. |
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|
Four weeks ending May 26, 2024 |
Year-over-year change |
Notes |
Median sale price |
$390,613 |
4.3% |
All-time high |
Median asking price |
$416,623 |
6% |
|
Median monthly mortgage payment |
$2,812 at a 6.94% mortgage rate |
7.3% |
$58 below all-time high set during the 4 weeks ending April 28 |
Pending sales |
89,218 |
-3.4% |
|
New listings |
101,172 |
7.8% |
|
Active listings |
912,320 |
15.2% |
Highest level since Dec. 2022 |
Months of supply |
3.2 |
+0.5 pts. |
4 to 5 months of supply is considered balanced, with a lower number indicating seller’s market conditions |
Share of homes off market in two weeks |
44.7% |
Down from 49% |
|
Median days on market |
32 |
+3 days |
|
Share of homes sold above list price |
31.8% |
Down from 34% |
|
Share of homes with a price drop |
6.4% |
+2 pts. |
Highest level since Nov. 2022 |
Average sale-to-list price ratio |
99.5% |
-0.2 pts. |
|
Metro-level highlights: Four weeks ending May 26, 2024 Redfin’s metro-level data includes the 50 most populous U.S. metros. Select metros may be excluded from time to time to ensure data accuracy. |
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|
Metros with biggest year-over-year increases |
Metros with biggest year-over-year decreases |
Notes |
Median sale price |
Anaheim, CA (19.3%) Detroit (16.4%) Nassau County, NY (12.5%) San Jose, CA (12.4%) West Palm Beach, FL (12.4%)
|
Fort Worth, TX (-0.4%) San Antonio, TX (-0.3%)
|
Decreased in 2 metros |
Pending sales |
San Jose, CA (13.7%) San Francisco (7.2%) Columbus, OH (6.5%) San Diego (5.3%) Anaheim, CA (4.2%) |
Houston (-15.1%) West Palm Beach, FL (-14.4%) Atlanta (-14.1%) Fort Lauderdale, FL (-12.5%) Orlando (-11.5%) |
Increased in 13 metros |
New listings |
San Jose, CA (34.5%) Phoenix (24.7%) San Diego (21%) Oakland, CA (20.1%) Montgomery County, PA (19.5%) |
Chicago (-10%) Atlanta (-9.4%) Newark, NJ (-6.4%) Detroit (-3.4%) Warren, MI (-1.9%) |
Decreased in 8 metros |
To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-update-sellers-drop-asking-prices
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, title insurance, and renovations services. We run the country's #1 real estate brokerage site. Our customers can save thousands in fees while working with a top agent. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can have our renovations crew fix it up to sell for top dollar. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than $1.6 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 4,000 people.
Redfin’s subsidiaries and affiliated brands include: Bay Equity Home Loans®, Rent.™, Apartment Guide®, Title Forward® and WalkScore®.
For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.
