New listings of homes for sale rose 4.1 percent year-over-year during the four weeks ending Oct. 12, the biggest increase in over four months, according to a new report from Redfin.
More sellers are entering the market because they’re hoping lower mortgage rates and a small improvement in affordability will attract buyers. The weekly average mortgage rate is 6.3 percent, just shy of its lowest level in a year.
Pending home sales are moving in the opposite direction, falling 1.2 percent year-over-year, the biggest decline in more than five months. Homes are also taking a longer time to sell, with the typical home sitting on the market for 48 days before going under contract, a week longer than last year.
Many buyers are sitting on the sidelines due to high sale prices and economic uncertainty, according to Redfin. The median home-sale price is up 1.9 percent year-over-year, the second-biggest increase in six months, keeping payments elevated even though they’re down from their all-time high. Pair that with financial unease amid the government shutdown, concerns about tariffs and recession jitters, and many Americans are opting against making the biggest purchase of their life.
“Buyers are hesitant because of concerns about job security and high mortgage rates,” Kansas City, Mo.-based Redfin Premier agent Jo Chavez said in a release. “Even though rates have come down from their peak, a lot of people are waiting for sub-6 percent rates before they buy. In Kansas City, where there are tens of thousands of government jobs, furloughs and potential layoffs are hitting hard. One client who works for the federal government started house hunting two years ago, then paused when he was furloughed last year. He had just started looking again, but now he’s not sure if he’s going to buy because his job is uncertain; he may be relocated out of state.”
In the Washington, D.C., metro area, home to hundreds of thousands of federal employees, homebuying demand is taking a hit as workers worry about their jobs amid the government shutdown.
Though federal workers are spread throughout the country, the lion’s share are in D.C. and surrounding parts of Maryland and Virginia. Pending home sales in D.C. are down 6.7 percent year-over-year, and the typical home is taking 43 days to go under contract — nine days longer than last year.
On the flip side, new listings are up 9.8 percent year-over-year in D.C., the third-biggest increase of the 50 most populous metros, as some locals try to offload their homes.