Redfin Corp - RDFN STOCK NEWS

Redfin reports that the typical U.S. asking rent increased by 0.6% year over year in September to $1,634, with East Coast and Midwest metros seeing the largest increases. Washington, D.C. recorded the highest rent increase of 12% to $2,088, while Jacksonville, FL saw the biggest decrease of 11.3% to $1,485. The median rent has remained relatively stable over the past two years, ranging between $1,599 and $1,663.

Sun Belt states dominated the metros with the largest rent declines. Asking rents fell across all bedroom counts, with 3+ bedroom apartments experiencing the largest decrease of 1.9% to $1,995. Redfin Senior Economist Sheharyar Bokhari noted that rent stability varies by location, with less construction activity in the East Coast and Midwest leading to rising rents, while Sun Belt cities with post-pandemic construction booms are seeing faster rent decreases.

Redfin reports a significant uptick in U.S. pending home sales, rising 2% year-over-year in the four weeks ending October 6, marking the largest increase in three years. This surge in demand is attributed to falling mortgage rates, which have reduced the typical homebuyer's monthly payment to $2,526, down 5.8% from last year. However, recent mortgage rate increases following a strong jobs report may impact future demand.

The report highlights regional variations, with coastal Florida experiencing declining sales, partly due to Hurricane Helene and rising insurance costs. New listings have increased by 5.7% year-over-year, continuing a year-long trend. The Redfin Homebuyer Demand Index is near its highest level since May, indicating strong buyer interest despite potential challenges ahead.

A new Redfin survey reveals that 32% of U.S. residents aged 18-34 are reconsidering their future living locations after witnessing the damage caused by Hurricane Helene. The storm, which hit Florida in late September and devastated parts of Appalachia, has prompted a shift in perspective on climate risks and housing choices.

Key findings include:

• 23% of respondents expect insurance premiums in their area to increase post-Hurricane Helene
• 13% believe it will be harder to obtain home insurance in their area
• 45% of overall respondents say the storm hasn't impacted their housing situation thoughts

The survey, conducted by Ipsos for Redfin, highlights growing awareness of climate change impacts on housing decisions across different regions and age groups.

Redfin reports that pending U.S. home sales were flat year-over-year during the four weeks ending September 29, marking the first time since January that pending sales didn't decline. This improvement is attributed to declining mortgage rates, with the average 30-year rate dropping to 6.08%, its lowest level in two years. The typical homebuyer's mortgage payment decreased to $2,529, a 5.9% year-over-year decline.

Homebuying demand is increasing, with Redfin's Homebuyer Demand Index up 9% month-over-month to its highest level since April. Mortgage-purchase applications are up 10% month-over-month. Pending sales increased year-over-year in 27 of the 50 most populous U.S. metros, with Phoenix leading at a 13% increase. However, some Florida markets are experiencing declines due to climate disasters and rising insurance costs.

New listings have been rising for nearly a year, with a 4.3% increase in the latest report. The median sale price is $383,375, up 4% year-over-year, while the median asking price is $401,700, up 5.3%.

A new Redfin survey reveals that 48.4% of U.S. renters believe Kamala Harris would be best for making housing more affordable, while 31.2% favor Donald Trump. The remaining 18.7% are unsure. The survey, conducted by Ipsos in September 2024, polled 1,802 people aged 18-65, focusing on 894 renter respondents.

Redfin Chief Economist Daryl Fairweather explains that renters tend to lean Democratic due to their demographics: younger people living in cities with higher living costs. Regarding voting intentions, 43.6% of surveyed renters plan to vote for Harris, 28% for Trump, while 12.3% don't plan to vote and 11.7% are undecided.

Fairweather emphasizes that solving the housing affordability crisis requires a coordinated effort between federal and local governments over many years, focusing on incentivizing homebuilding to address the housing shortage.

Redfin reports that 54% of newly constructed apartments completed in Q1 2024 were rented within three months, up from 47% in the previous quarter but down from 58% a year earlier. This uptick may indicate building owners are attracting renters with more affordable rents and concessions. The slower absorption rate compared to previous years is attributed to increased apartment construction, especially in Sun Belt metros. Studio apartments filled up faster at 58%, while one-bedroom and two-bedroom units saw a 53% absorption rate. The national rental vacancy rate for buildings with five or more units increased to 7.8% in Q2, up from 7.4% a year earlier, suggesting supply slightly outpaces demand.

Redfin reports that buying a starter home is now cheaper than it was a year ago. U.S. homebuyers need to earn $76,995 annually to afford the median-priced starter home ($250,000), down 0.4% year over year. This is the first annual decline since August 2020, primarily due to lower mortgage rates offsetting the 4.2% increase in starter-home prices.

However, starter homes are still much less affordable than before the pandemic. The typical household earns $83,853 per year, 8.9% more than needed for a median-priced starter home. This is an improvement from last August but a significant setback from pre-pandemic levels. In August 2019, households earned 57.1% more than needed, and in August 2012, they earned 113% more.

The report highlights that pandemic boomtowns are seeing the steepest drops in income needed to afford a starter home, with Anaheim, CA experiencing the largest decline at 8.1% year over year. Four metros, all in Texas or Florida, have seen starter homes go from unaffordable to affordable in the past year.

Redfin reports that the U.S. home turnover rate has hit a 30-year low, with only 25 out of every 1,000 homes changing hands in the first eight months of 2024. This represents a 37.5% decrease from 2021's pandemic buying frenzy and a 31% drop from 2019. The low turnover is attributed to elevated mortgage rates, rising home prices, low supply, and economic uncertainty.

The rate of homes being listed for sale also fell to the lowest level in over a decade, with just 32 out of every 1,000 homes listed in the first eight months of 2024. Suburban and rural areas saw slightly higher turnover rates compared to urban areas. Among major metros, Phoenix had the highest turnover rate, while Los Angeles had the lowest.

Redfin reports that asking rents for newly constructed apartments fell to $1,746 in the second quarter, down 6.2% from a year earlier, reaching the lowest level in over two years. This decline coincides with a surge in new apartment completions, which rose 18.7% year-over-year in the first quarter, hitting the highest number in over a decade.

The report highlights that one-bedroom apartments saw the largest rent declines, dropping 9% to $1,566. Two-bedroom and three-or-more-bedroom apartments also experienced decreases, while studio apartments saw a slight increase. Redfin Senior Economist Sheharyar Bokhari suggests that rents for new apartments may continue to fall due to the ongoing construction boom, creating opportunities for renters in markets with high levels of new development.