- New U.S. home listings increased by 8.4% year-over-year, the highest in nearly three years.
- Pending home sales dropped by 2.2%, marking a record low for this time of year since 2015.
- The median monthly mortgage payment reached an all-time high of $2,882 with mortgage rates nearing 7%.
In a recent real estate market update, Redfin (RDFN, Financial) reported a significant uptick in U.S. home listings, which increased by 8.4% year-over-year for the four weeks ending on May 18. This marks the highest level of new listings in nearly three years. Despite the surge in available properties, potential buyers are hesitant, leading to a 2.2% decline in pending sales, the lowest for this period since Redfin began tracking the data in 2015.
The overall number of homes for sale has risen 14.3% year-over-year, achieving the highest inventory levels seen in nearly five years. This accumulation is partially attributed to the record-high median monthly mortgage payment of $2,882, influenced by a 1.7% rise in home prices and mortgage rates approaching 7%.
Economic instability and elevated housing costs are causing buyer reluctance, as consumer sentiment remains low due to concerns over a trade war and potential recession. Sellers are motivated to list their homes, with some looking to downsize or move to more affordable areas, while others anticipate a decline in housing prices and wish to sell before increased competition further impacts the market.
Redfin's Premier agent Hazel Shakur advises potential sellers to consider listing soon due to the unpredictable nature of home values and the broader economy. Buyers, meanwhile, may find opportunities in the current climate to negotiate prices below asking or secure concessions from sellers.
Market indicators reveal a modest increase in mortgage rates, with the daily average 30-year fixed mortgage rate at 7.05% as of May 21, rising from 6.92% the previous week. Although this represents a decrease from the previous year's rate of 7.09%, it continues to weigh heavily on purchasing decisions.
