Redfin Reports Existing Home Sales Rose 0.6% Last Month, But Were At the Lowest July Level on Record

Rhea-AI Summary

Redfin reports that existing home sales in July 2024 rose 0.6% month-over-month but fell 2% year-over-year to a seasonally adjusted annual rate of 4,094,991 - the lowest July level since 2012. Pending sales declined 2.9% from June and 5.8% from last year, marking the biggest drops in nearly a year. The median sale price increased 4.1% year-over-year to $439,170, just 0.7% below the all-time high.

Despite lower mortgage rates, buyers have been slow to react, partly due to high home prices and economic uncertainty. Positively for buyers, the total supply of homes for sale rose 13.7% year-over-year, and only 33.2% of homes sold above asking price. However, about 15.8% of home-purchase agreements were canceled in July, the highest percentage on record for any July since 2017.

Positive

• Existing home sales rose 0.6% month-over-month in July
• Median sale price increased 4.1% year-over-year to $439,170
• Total supply of homes for sale (active listings) rose 13.7% year-over-year
• New listings were up 2.9% year-over-year
• Only 33.2% of homes sold for more than their asking price, down from 38.2% a year earlier

Negative

• Existing home sales fell 2% year-over-year to the lowest July level since 2012
• Pending sales declined 2.9% month-over-month and 5.8% year-over-year
• Median sale price is just 0.7% below the all-time high of $442,389
• 15.8% of home-purchase agreements were canceled in July, the highest percentage for any July on record
• Total supply of homes for sale fell 0.6% month-over-month, the first seasonally-adjusted decline in a year

Insights

Financial Analyst

The housing market's performance in July presents a mixed picture. While existing home sales rose 0.6% month-over-month, they're at their lowest July level since 2012. The 2.9% decline in pending sales is particularly concerning, indicating weakening demand. However, the 4.1% year-over-year increase in median sale price to $439,170 suggests some resilience in home values.

The 13.7% year-over-year increase in total supply of homes is a double-edged sword. It provides more options for buyers but also indicates potential market softness. The fact that only 33.2% of homes sold above asking price, down from 38.2% a year ago, further supports this view.

The record-high 15.8% cancellation rate for home-purchase agreements is a red flag, reflecting economic uncertainty and affordability concerns. This could lead to increased market volatility and potentially impact home builders and real estate companies negatively in the short term.

Market Research Analyst

The housing market's regional disparities are striking. New Brunswick, NJ saw a 14.6% increase in median sale prices, while Austin, TX experienced a 2.6% decrease. This highlights the importance of local market dynamics in real estate investment decisions.

The surge in active listings in markets like Tampa (up 51.8%) and Cincinnati (up 49.4%) suggests a potential shift in market power towards buyers in these areas. However, the decline in new listings in Atlanta (down 15.1%) and Portland (down 12%) indicates supply constraints in other markets.

The varying percentages of homes sold above list price - from 69% in Newark to just 7.8% in West Palm Beach - further underscores the localized nature of real estate trends. Investors should be cautious about making broad generalizations and instead focus on specific market conditions in their areas of interest.

Pending sales were down 3% month over month and 6% year over year—both of which were the biggest drops in nearly a year

SEATTLE--(BUSINESS WIRE)-- (NASDAQ: RDFN) —Sales of existing homes rose 0.6% month over month in July, but fell 2% year over year—to a seasonally adjusted annual rate of 4,094,991. That’s the lowest July level in records dating back to 2012. This is according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

Pending sales—a more current gauge of demand that includes both existing and newly-constructed homes—fell to the lowest level of any month on record aside from April 2020, when the pandemic brought the housing market to a halt. They declined 2.9% from a month earlier and 5.8% from a year earlier—both the biggest declines in nearly a year on a seasonally adjusted basis.

Mortgage rates dropped in July and have fallen even further in August—giving house hunters more purchasing power—but buyers have been slow to react. That’s likely in part because home prices are still near their record high. The median sale price rose 4.1% year over year in July to $439,170. That’s just 0.7% below the all-time high of $442,389 set the prior month.

“When rates finally dropped, buyers got excited and we saw more activity. But now that rates have fallen to the mid-6%-range, people have been waiting to see if they’ll drop even more. Home prices are going up, though, so it really becomes six of one, half dozen of the other, ” said Nicole Stewart, a Redfin real estate agent in Boise, ID. “A lot of people are also concerned about the political climate. They can afford to buy, but have been holding off because it’s unclear where the country will be in six months. Though in reality, who is in the Oval Office probably won’t have much of an impact on the housing market.”

July 2024 Housing Market Highlights: United States
	July 2024	Month-over-month change	Year-over-year change
Median sale price	$439,170	-0.7%	4.1%
Existing home sales, seasonally adjusted annual rate	4,094,991	0.6%	-2%
Pending sales, seasonally adjusted	457,272	-2.9%	-5.8%
Homes sold, seasonally adjusted	417,066	0.2%	-1.6%
New listings, seasonally adjusted	494,500	0.0%	2.9%
Total homes for sale, seasonally adjusted (active listings)	1,635,395	-0.6%	13.7%
Months of supply	2.6	-0.1	0.3
Median days on market	34	2	5
Share of homes sold above final list price	33.2%	-1.9 ppts	-4.9 ppts
Average sale-to-final-list-price ratio	99.6%	-0.3 ppts	-0.5 ppts
Pending sales that fell out of contract, as % of overall pending sales	15.8%	1.3 ppts	1.0 ppt
Average 30-year fixed mortgage rate	6.85%	-0.07 ppts	0.01 ppts

“Waiting around for mortgage rates to fall further isn't a surefire strategy,” said Redfin Senior Economist Elijah de la Campa. “If you have the means to buy and have been thinking about doing so, now actually might not be a bad time. That’s because mortgage rates have fallen enough to boost your purchasing power, but not enough to bring tons of buyers off of the sidelines and drive up competition.”

The Good News: More Homes to Choose From, and Fewer Selling for Above-Asking Price

There are a few encouraging signs for homebuyers aside from the dip in mortgage rates. For one, the total supply of homes for sale (active listings) rose a record 13.7% year over year in July.

Many listings on the market are getting stale as buyers grapple with high costs, which is causing supply to pile up—giving some buyers room to negotiate. The typical home that went under contract in July spent 34 days on the market, up from 29 days a year earlier and the longest of any July since 2020.

It’s worth noting that active listings did fall 0.6% from a month earlier in July—the first seasonally-adjusted decline in a year. New listings were little changed from a month earlier, and while they were up 2.9% year over year, they were still at the lowest level since last July.

Another silver lining for buyers: Only one-third of homes (33.2%) sold for more than their asking price, down from 38.2% a year earlier and the lowest share of any July since 2020.

Homebuyers Are Backing Out of Deals at a Record Rate

Roughly 59,000 home-purchase agreements were canceled in July, equal to 15.8% of homes that went under contract that month—the highest percentage of any July on record. Redfin’s records for this statistic date back to 2017.

Many house hunters are getting cold feet because housing costs remain high. Economic uncertainty is also high, with recession fears on the rise.

Buyers in Florida and Texas were most likely to back out of deals. Housing markets across both states have slowed considerably since the pandemic moving frenzy, with markets on Florida’s West Coast cooling faster than anywhere else in the nation amid rising supply and a climate-fueled insurance crisis.

In Tampa, 1,266 home-purchase agreements were canceled in July, equal to 21.9% of homes that went under contract that month—a higher share than any other major metro. Next came Fort Lauderdale (21.8%) and San Antonio (21.8%). The shares were lowest in Nassau County (5.4%), San Francisco (6.1%) and San Jose (7%).

Metro-Level Highlights: July 2024

• Prices: Median sale prices rose most from a year earlier in New Brunswick, NJ (14.6%), Detroit (13.5%) and Newark, NJ (12%). They fell in just two metros–Austin, TX (-2.6%) and Dallas (-1.2%)—and were flat in San Antonio.
• Pending sales: Pending sales rose most in San Francisco (13.5%), San Jose, CA (13.3%) and Newark (12.7%). They fell most in Houston (-22.1%), Minneapolis (-11.8%) and Atlanta (-9.8%).
• Closed home sales: Home sales rose most in San Jose (26.7%), San Francisco (17.4.%) and Providence, RI (17.3%). They fell most in West Palm Beach, FL (-7.7%), Detroit (-5.1%) and Austin (-4.1%).
• Active listings: Active listings rose most in Tampa, FL (51.8%), Cincinnati (49.4%) and Fort Lauderdale (49.1%). They fell in just one metro—Chicago (-1.6%)—and were up less than 1% in New York (0.7%) and Milwaukee (0.9%).
• New listings: New listings rose most in Providence (20.1%), San Jose (19.2%) and Las Vegas (18.4%). They fell most in Atlanta (-15.1%), Portland, OR (-12%) and Houston (-11.1%).
• Sold above list price: In Newark, 69% of homes sold above their final list price, the highest share among the metros Redfin analyzed. Next came San Jose (65.5%) and Nassau County, NY (60.6%). The shares were lowest in West Palm Beach (7.8%), Miami (11.4%) and Fort Lauderdale (12.2%).

To view the full report, including charts please visit:
https://www.redfin.com/news/existing-home-sales-july-2024

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, title insurance, and renovations services. We run the country's #1 real estate brokerage site. Our customers can save thousands in fees while working with a top agent. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can have our renovations crew fix it up to sell for top dollar. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than $1.6 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 4,000 people.

Redfin’s subsidiaries and affiliated brands include: Bay Equity Home Loans®, Rent.™, Apartment Guide®, Title Forward® and WalkScore®.

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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240819290841/en/

Redfin Journalist Services:

Kenneth Applewhaite

press@redfin.com

Source: Redfin

FAQ

What was the seasonally adjusted annual rate of existing home sales for July 2024?

The seasonally adjusted annual rate of existing home sales for July 2024 was 4,094,991, which is 0.6% higher than the previous month but 2% lower than the same period last year.

How did pending sales perform in July 2024 for Redfin (RDFN)?

Pending sales for Redfin (RDFN) in July 2024 declined 2.9% from the previous month and 5.8% from the previous year, marking the largest declines in nearly a year on a seasonally adjusted basis.

What was the median sale price for homes in July 2024 according to Redfin (RDFN)?

According to Redfin (RDFN), the median sale price for homes in July 2024 was $439,170, which is a 4.1% increase year-over-year and just 0.7% below the all-time high of $442,389 set in the previous month.

What percentage of home-purchase agreements were canceled in July 2024 for Redfin (RDFN)?

For Redfin (RDFN), approximately 15.8% of home-purchase agreements were canceled in July 2024, which is the highest percentage for any July in their records dating back to 2017.