Home Prices Up 13%, Biggest Increase Since 2013

Rhea-AI Summary

The U.S. median home sale price surged 13% year-over-year to $319,178, marking the highest figure since October 2013, according to Redfin's latest report. Key highlights include a 28% increase in pending home sales and a 9% rise in new listings, both the largest since 2015. Despite these gains, active listings dropped by 28%, reaching an all-time low. The average sale-to-list price ratio hit a record 99.3%, while Redfin's Homebuyer Demand Index rose 21% from pre-pandemic levels. Challenges remain for first-time buyers due to escalating prices and changing market dynamics influenced by remote work.

Positive

• U.S. median home sale price rose 13% year-over-year to $319,178.
• Pending home sales increased by 28%, the largest rise since 2015.
• New listings of homes for sale were up 9%, the biggest gain since 2015.
• Average sale-to-list price ratio reached a record high of 99.3%.
• Redfin Homebuyer Demand Index rose 21% from pre-pandemic levels.

Negative

• Active listings fell 28% from 2019, reaching an all-time low.
• High home prices are making the market challenging for first-time buyers.
• Home touring slowed in areas affected by wildfires, impacting sales activity.

SEATTLE, Sept. 11, 2020 /PRNewswire/ -- (NASDAQ: RDFN) — The U.S. median home sale price increased 13% from 2019 to $319,178—the highest on record, according to a new report from Redfin (www.redfin.com), the technology-powered real estate brokerage. This 13% year-over-year increase was the largest since October 2013.

Below are other key housing market takeaways for 434 U.S. metro areas during the 4-week period ending September 6.

• Pending home sales climbed 28% year over year, the largest increase since the four weeks ending August 2, 2015.
• New listings of homes for sale were up 9% from a year ago—the largest increase since the four weeks ending December 20, 2015.
• Active listings (the number of homes listed for sale at any point during the period) fell 28% from 2019 to a new all-time low. The year-over-year decline has been about the same for the past couple of months.
• 46.4% of homes that went under contract had an accepted offer within the first two weeks on the market, the highest level since at least 2012 (as far back as our data on this measure goes).
• The average sale-to-list price ratio, which measures how close homes are selling to their asking prices, rose to 99.3%—an all-time high and a full percentage point higher than a year earlier.
• For the week ending September 6, the seasonally adjusted Redfin Homebuyer Demand Index was up 21% from pre-pandemic levels in January and February.

"Home price growth this high is making the housing market especially difficult for first-time homebuyers right now," said Redfin chief economist Daryl Fairweather. "Rising prices are just one more reason for people to leave expensive urban neighborhoods behind. The sudden rise of remote work has allowed homebuyers who are priced out of one neighborhood to expand their search to more affordable areas. In turn, they are pushing up home prices in those relatively affordable areas, causing more people to look to even more affordable areas, and so on. Price growth may slow in 2021, but even if it does, high prices are going to continue to make affordability a concern for buyers."

"I've been helping more buyers from out of town lately, mostly from the Bay Area," said Seattle Redfin agent Christian Cerone. "They're unfazed by the intensity of the market, since that's been the norm there for quite a while. We've also started to see bidding wars even on homes above $1 million, which were seemingly immune to bidding wars even when the market got really crazy in recent years. With so much wealth coming into the city from more expensive places, there are plenty of buyers right now who have the potential to buy those $1-$2 million homes."

Redfin agents in areas affected by wildfires report that the smoke is slowing down some home-buying activity.

"Home touring is slowing down in San Francisco due to the fires—people don't want to go outside with all of the smoke in the air," said local Redfin agent Gabrielle Bunker. "Some buyers have also started raising concerns about being able to get fire insurance because insurance companies have tightened up their requirements for fire coverage."

To view the full report, including charts and methodology, please visit: https://www.redfin.com/blog/home-prices-up-13-percent/

About Redfin
Redfin (www.redfin.com) is a technology-powered residential real estate company, redefining real estate in the consumer's favor in a commission-driven industry. We do this by integrating every step of the home buying and selling process and pairing our own agents with our own technology, creating a service that is faster, better and costs less. We offer brokerage, iBuying, mortgage, and title services, and we also run the country's #1 real estate brokerage search site, offering a host of online tools to consumers, including the Redfin Estimate. We represent people buying and selling homes in over 90 markets in the United States and Canada. Since our launch in 2006, we have saved our customers over $800 million and we've helped them buy or sell more than 235,000 homes worth more than $115 billion.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.

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SOURCE Redfin

FAQ

What is the current median home sale price according to Redfin?

The current median home sale price is $319,178, reflecting a 13% increase from 2019.

How much did pending home sales increase year-over-year?

Pending home sales increased by 28% year-over-year, the largest increase since August 2015.

What is the average sale-to-list price ratio reported by Redfin?

The average sale-to-list price ratio reached 99.3%, an all-time high.

How have new listings changed compared to last year?

New listings of homes for sale were up 9% from the previous year, marking the largest increase since December 2015.

What impact are wildfires having on home-buying activity?

Wildfires are slowing down home-buying activity, particularly in areas like San Francisco, due to smoke and concerns about fire insurance.