The demand for housing went up in September, according to the latest Redfin Housing Demand Index. The Index reports that demand increased by 5.1 percent in September to 131. Redfin notes that this comes following several months of the index staying flat, with the September increase driven by an increase in “early stage home-buying activity.”
"There are a couple of explanations for the increase in buyer activity from August to September," said Redfin Chief Economist and Report Author Daryl Fairweather. "One is that rising mortgage rates motivated some buyers to look for a home before rates rise again. Second, inventory usually falls from August to September, but this year it rose 0.7 percent, giving buyers more homes to choose from."
Redfin notes that the number of people requesting home tours increased 11.2 percent month over month in September, the largest monthly increase in 16 months, while the number writing offers increased by 8.1 percent.
According to Fairweather, many buyers are plagued by the difficulty making the right decision in areas such as San Francisco and Boston, where inventory has increased. Buyers are afraid of making the wrong decision when buying a home as their options increase.
"Buyers hear that the market has slowed and are curious to see what's available, but in general I find that today's buyers don't have the same strong sense of urgency to make offers that they had this time last year," said Los Angeles Redfin Agent Alec Traub . "Buyers tell me they like a home, but they don't love it. Last year, buyers would jump to offer on a home they only liked, but now they are waiting to fall in love."
Los Angeles saw the largest month-over-month increase in demand in September, up 18.1 percent. Meanwhile, Boston saw a two percent increase in demand, but a 17.1 percent increase in inventory month-over-month, compared to the national inventory increase of 0.7 percent.
Find the full report from Redfin here.