The median U.S. home-sale price increased 0.9 percent from a year earlier to $350,250 during the four weeks ending Jan. 15, the biggest increase in a month, according to a new report from Redfin.
Prices remain elevated with buyer activity picking up as mortgage rates decline due to slowing inflation. Average mortgage rates dropped to 6.15 percent during the week ending Jan. 19, their lowest level since September.
Pending home sales fell 29 percent year-over-year—a significant decline and the first sub-30 percent drop in three months. Mortgage-purchase applications rose 25 percent from the week before the week ending Jan. 13, a jump that’s likely to lead to more pending sales in the coming months, according to Redfin.
New listings of homes for sale fell 20 percent year-over-year during the four weeks ending Jan. 15, the smallest decline in two months.
“The people who started browsing homes online and scheduling house tours at the end of 2022 are now turning into actual homebuyers,” Redfin Deputy Chief Economist Taylor Marr said in a releae. “Low competition, falling mortgage rates and seller concessions are bringing some buyers back to the market. That’s helping keep national home prices afloat, which is one bright spot for sellers. But many buyers are still sitting on the sidelines and demand could dip back down if inflation declines slower than expected or mortgage rates rise again.”
Home prices fell in 18 of 50 metros
Home-sale prices fell year-over-year in 18 of the 50 most populous metros during the four weeks ending Jan. 15. By comparison, 20 metros saw a price decline during the prior four-week period and 11 metros saw price declines a month earlier.
Prices fell 10.1 percent year-over-year in San Francisco, 6.7 percent in San Jose, 5.5 percent in Austin, Texas, 4.3 percent in Detroit, 3.8 percent in Seattle, 3.7 percent in Phoenix, 3.4 percent in Sacramento, Calif., 3.1 percent in San Diego, 2.8 percent in Anaheim, Calif., 2.5 percent in Chicago, 2.4 percent in Los Angeles, 2.3 percent in Oakland, Calif., and 2.2 percent in Boston. They fell less than 2 percent in Riverside, Calif., Portland, Ore., New York, Newark, N.J., and Las Vegas.
Leading indicators of homebuying activity:
• For the week ending Jan. 19, 30-year mortgage rates dropped to 6.15 percent. The daily average was 6.04 percent on Jan. 18.
• Mortgage-purchase applications during the week ending Jan. 13 jumped 25 percent from a week earlier, seasonally adjusted. Purchase applications were down 35 percent from a year earlier.
• Google searches for “homes for sale” were up about 30 percent from their November low during the week ending Jan. 14, but down about 26 percent from a year earlier.