Investing.com -- According to a recent report from technology-powered real estate brokerage Redfin (NASDAQ:RDFN), pending home sales in the U.S. have declined by 3.4% year over year in the four weeks ending May 11. This marks the lowest level on record for this time of year, excluding 2020.
The dip in sales is attributed to two main factors. First, rising home-sale prices and elevated mortgage rates have pushed the median monthly housing payment to $2,860, just $6 short of the record high set the previous week. Second, potential homebuyers are expressing concerns about the future of the U.S. economy, leading them to delay their purchasing decisions.
Redfin agents in several states, including Oregon, North Carolina, Texas, and Ohio, report that some buyers are stepping back due to these economic concerns. The timing of Easter this year, which fell within the four-week period, may also have impacted sales, as it did not coincide with the same period in 2024.
On the brighter side, new listings have risen by 5.1% year over year, and the total number of homes for sale has increased by 14.3%. This rise in supply, coupled with decreased demand, has led to nearly half of home sellers offering concessions. Agents are advising buyers to negotiate sale prices down or ask for money for repairs or closing costs.
The report also indicates that the daily average 30-year fixed mortgage rate is at 6.95% as of May 14, down from 7.07% one month earlier and 7.12% year over year. The weekly average 30-year fixed mortgage rate remained steady at 6.76% for the week ending May 8, down from 7.09% year over year.
Meanwhile, mortgage-purchase applications have increased by 2% from a week earlier, as of the week ending May 9, marking an 18% rise year over year. Google (NASDAQ:GOOGL) searches for "home for sale" have also increased by 13% from a month earlier, as of May 12, indicating a 4% rise year over year.
In the metro-level data for the four weeks ending May 11, Newark, NJ, saw the biggest year-over-year increase in median sale price at 12%, while Oakland, CA, experienced the largest decrease at -4.3%. The highest increase in pending sales was in Virginia Beach, VA, at 7%, while Miami saw the most significant decrease at -19%. Washington, D.C., had the largest increase in new listings at 17%, while San Jose, CA, had the biggest decrease at -7.6%.
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