Pending home sales fell 2.2 percent week-over-week during the four weeks ending July 12, the first decline in a month, according to a new report from Redfin.
Some house hunters backed off due to high housing costs. The weekly average mortgage rate rose back up to 6.49 percent after dipping to 6.43 percent the previous week, and the daily average rate shot up to its highest level in nearly a year. The median home-sale price was just about $800 shy of the all-time high.
Another factor in the drop is the shaky global economy, which grew more uncertain last week as the U.S.-Iran ceasefire ended and oil prices jumped. The decline may also reflect normal week-to-week volatility rather than a major shift in demand, according to Redfin.
On the selling side, new listings fell 1.2 percent week-over-week to their lowest level since the start of the year. While there are still hundreds of thousands more sellers than buyers in the market, fresh listings are sliding because some homeowners are opting to stay put rather than try to sell during a time of subdued demand.
“First-time buyers are having a tough time breaking into the market,” Christine Kooiker, a Redfin Premier agent in Grand Rapids, Mich. “High mortgage rates mean that even homes in the most affordable price point — under $350,000 in the Grand Rapids area — are a stretch for a lot of buyers, and they’re hard to find and competitive. A lot of move-up buyers are sitting on the sidelines, too, because they’re locked into low mortgage rates or can’t find a new home they love. High-income buyers and retirees who spend the summer in Michigan are most active, scooping up newly built single-family homes and luxury condos.”