Housing supply is finally rebounding as sellers
get used to elevated mortgage rates, but it’s not rebounding enough
to curb home price growth. High housing costs mean many house
hunters remain hesitant to commit.
(NASDAQ: RDFN) — New listings jumped 3.8% month over month on a
seasonally adjusted basis in February to the highest level since
September 2022, according to a new report from Redfin (redfin.com),
the technology-powered real estate brokerage. They were up 14.8%
year over year, the largest annual gain since May 2021.
Active listings, or the total supply of homes for sale, hit the
highest level in a year. They climbed 0.8% from a month earlier on
a seasonally adjusted basis, and were little changed (-0.1%) from a
year earlier–the smallest annual decline in months.
New listings rose fastest from a year earlier in Texas and
active listings rose fastest in Florida–the two states that have
been building the most homes. In Florida, condo listings in
particular are contributing to the jump in supply amid a surge in
HOA and insurance fees.
“The housing market is nothing like it was two years ago during
the pandemic homebuying frenzy, but it’s better than it was last
year. It’s coming back,” said David Palmer, a Redfin Premier real
estate agent in Seattle. “Sellers who were on the fence in 2023 are
now listing. They’re more used to elevated rates now. There still
aren’t enough listings to quench pent-up buyer demand, but it’s
getting better.”
Nationwide, housing supply is on the rise because the “lock-in
effect” is easing; eventually, homeowners who have been holding on
to their ultra-low mortgage rates simply have to move.
“February was a mixed bag for the housing market and the
economy,” said Redfin Economics Research Lead Chen Zhao. “Housing
supply is finally starting to recover in a meaningful way, which is
great news for buyers who for months have been competing for a tiny
pool of homes for sale. Still, many house hunters are hesitant to
pull the trigger because mortgage rates and home prices remain
elevated.”
Mortgage-purchase applications slid in February as mortgage
rates ticked back up after dropping in December. The average
30-year-fixed mortgage rate was 6.78% last month, up from 6.64% in
January. Mortgage rates will likely remain elevated a bit longer
than expected after this week’s inflation report came in hotter
than anticipated.
Home sales rose 0.5% month over month on a seasonally adjusted
basis in February, and fell 3.5% year over year.
Home Prices Post Biggest Increase in Nearly a Year and a
Half
The median U.S. home sale price climbed 6.6% year over year–the
biggest uptick since September 2022–to $412,778. Please note that
home price data is not seasonally adjusted, which is why Redfin
focuses on year-over-year changes for this metric.
Prices continue to rise because despite the recent uptick in
listings, there’s still not enough supply to meet demand. Both new
listings and active listings remained far below pre-pandemic levels
in February.
“If you price your home reasonably, buyers will show up. If you
don’t, buyers will wait for you to drop the price,” Palmer said. “I
recently listed an estate sale fixer upper for $550,000 and it got
14 offers, sold for $75,000 over the asking price and the buyer
waived every contingency.”
In Seattle, 77.4% of homes that went under contract did so
within two weeks–the highest share among the metros Redfin
analyzed. It took the top spot from Rochester, which has held that
title for months. The typical home that went under contract in
Seattle did so in 11 days (versus a national median of 48
days).
February 2024 Highlights: United States
February 2024
Month-Over-Month
Change
Year-Over-Year
Change
Median sale price
$412,778
2.7%
6.6%
Homes sold, seasonally adjusted
422,203
0.5%
-3.5%
New listings, seasonally
adjusted
548,285
3.8%
14.8%
All homes for sale, seasonally adjusted
(active listings)
1,601,260
0.8%
-0.1%
Months of supply
2.7
-0.5
0
Median days on market
48
-2
-5
Share of for-sale homes with a price
drop
16.1%
-0.1 ppts
2.9 ppts
Share of homes sold above final list
price
26.1%
2 ppts
2.6 ppts
Average sale-to-final-list-price
ratio
98.7%
0.4 ppts
0.5 ppts
Average 30-year fixed mortgage
rate
6.78%
0.13 ppts
0.52 ppts
Metro-Level Highlights: February 2024
- New listings: New listings rose most from a year earlier
in Austin, TX (44.6%), Dallas (38.1%) and Charleston, SC (36.8%).
They fell in two metros–Albany, NY (-2.9%) and Buffalo, NY (-0.7%)
–and were flat in Fresno, CA (0%).
- Active listings (total supply): Active listings
increased fastest in Cape Coral, FL (60.6%), North Port, FL (52.5%)
and Fort Lauderdale, FL (25.5%). They decreased fastest in Raleigh,
NC (-24.4%), New Brunswick, NJ (-19%) and Nassau County, NY
(-18.5%).
- Prices: Median sale prices rose most from a year earlier
in Newark, NJ (16.5%), Anaheim, CA (15.8%) and Grand Rapids, MI
(15.8%). They fell in three metros: San Antonio (-4.2%), Memphis,
TN (-3.5%) and North Port (-2.2%).
- Closed home sales: Closed sales rose most in San Jose,
CA (24.9%), San Francisco (21.1%) and Dayton, OH (15.1%). They fell
most in Frederick, MD (-14.8%), New Orleans (-14.2%) and Tulsa, OK
(-14%).
- Sold above list price: In San Jose, 65.3% of homes sold
above their final list price, the highest share among the metros
Redfin analyzed. Next came Rochester, NY (62.8%) and Oakland, CA
(62.3%). The shares were lowest in North Port (6.6%), Cape Coral
(8.3%) and West Palm Beach, FL (8.7%).
- Off market in two weeks: In Seattle, 77.4% of homes that
went under contract did so within two weeks—the highest share among
the metros Redfin analyzed. Next came Rochester (75%) and San Jose
(70.9%). The lowest shares were in Honolulu (8.4%), Greensboro, NC
(19%) and McAllen, TX (20.8%).
- Days on market: The typical home that went under
contract in Seattle did so in 11 days, making the fastest market
among those Redfin analyzed. Next came Rochester (12) and San Jose
(12). The slowest markets were New Orleans (97), Austin (82) and
Honolulu (77).
To view the full report, including charts, please visit:
https://www.redfin.com/news/housing-market-tracker-february-2024
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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240315811247/en/
Redfin Journalist Services: Ally Braun, 206-588-6863
press@redfin.com
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