Homebuying demand [1]fell 15% for the week ending on April 26, which is a significant increase from falling as low as 34% in March, according to Redfin.
New listings are up from their low point on April 13, but there are fewer than 70,000 homes for sale in Redfin markets—a five-year low.
Redfin reports that 53,000 new homes hit the market for the week ending on April 24, which is a slight increase from the 48,000 added for the week ending on April 13. Pending home sales were up slightly to more than 32,500 for the week ending on April 24 from the 31,000 on April 13.
Home prices, however, have been steady, as the median list price for the week ending on April 24 was $308,000—a year-over-year increase of 1%.
“Buyers and sellers are in a deadlock. Buyers are asking ‘is now the right time,’ and making more conservative offers, but sellers are not willing to come down on price,” Octavia Valencia, a Redfin agent in Atlanta said.
Graham Rogers, a Redfin agent in South Carolina [2] added, “In the end, buyers are paying up to hit the seller’s bottom-line number.”
The report by Redfin also said the Fannie Mae forecasts call for rates to continue to drop, and could dip below 3% for the first time since 2021.
The 0.5% decline in mortgage rates reduces the monthly payment on a $300,000 home by $65 per month. Time to close a translation once the buyer and seller agreed on price increased to 18 days. This is up from 27 days in the last week of February before the pandemic started and the longest time since July 2017.
The report also states lenders are still overwhelmed by the refinance boom driven by low rates.
Carlos Barrientos, a Redfin agent in San Francisco [3], reports that appraisers have also gotten more conservative [4].
“Appraisers will look at three similar homes and take the lowest of the three rather than taking an average. Even if one home has a great view or something special, they aren’t giving out any extra credit,” he said.