As mortgage rates hover near 7%, homebuyers are feeling the increase.
Between mid-August and late September, the average homebuyer’s monthly mortgage payment has risen 15% or $337, reaching $2,547 for the median asking price, a new high, according to Redfin. This is up 50% year over year, when the median monthly payment was $1,698 for the median asking price. By the end of September, mortgage rates officially hit 6.7%, the highest level in more than 15 years. Despite buyers’ hesitations on entering the market, sellers are still listing. While it is far from a balanced market, supply across the U.S. reached three months for the first time in more than two years. Acting listings are up 6% year over year. The report also found that touring activity was down 18% compared to the beginning of the year.
However, despite these challenges, home prices did see an increase, rising 1% from the beginning of September to the end, after 11 weeks of consecutive drops. The median home sale price was $369,250, while the median asking list of newly listed homes was $384,750, a 10% increase from last year. Pending home sales have dropped 21% year over year, the biggest drop since May 2020, while new listings are down 14% year over year. Around one-third (35%) of homes were under contract within two weeks of entering the market, down 5% year over year. Homes under contract within a week of listing dropped from 28% to 24% year over year.
Not surprisingly, homes are lasting on the market a bit longer, homes that sold between mid-August and late September were on the market for a median of 31 days, up from 24 days year over year. The record low was 17 days in May-June 2022. Still, one-third of homes sold above their asking price, a decrease of 14% year over year and the lowest since February 2021.