Redfin Reports Homes Are Taking Longer to Sell

Rhea-AI Summary

The recent report from Redfin (NASDAQ: RDFN) highlights a challenging housing market, where the typical home sold during the four weeks ending July 17 spent 19 days on the market, an increase from last year. Despite limited new listings, overall home sales fell significantly, with pending home sales declining 15% year-over-year, marking the largest drop since May 2020. Home sale prices slightly decreased by 0.6%. Key indicators show a 19% drop in mortgage applications and a 23% decline in searches for homes. The median home sale price rose 11% year-over-year to $389,200 but is down from the prior peak.

Positive

• Median home sale price increased 11% year-over-year to $389,200.
• Active listings rose 3% year-over-year, reflecting the largest increase since August 2019.

Negative

• Pending home sales fell 15% year-over-year, the largest decline since May 2020.
• 30-year mortgage rates rose to 5.54%, significantly impacting affordability.
• Searches for 'homes for sale' on Google decreased by 23% year-over-year.
• Mortgage purchase applications were down 19% from a year earlier, the lowest level since April 2020.

Buyers can now take their time touring and considering homes before making an offer. Still, selection remains very limited despite supply being up, as few homes are being listed and even fewer are selling.

SEATTLE--(BUSINESS WIRE)-- (NASDAQ: RDFN) —The typical home sold during the four weeks ending July 17 spent 19 days on the market, one day longer than last year. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

This marks the first time in two years that the median time on market has posted a year-over-year gain. Pending home sales fell more than they have since May 2020, and the total number of homes for sale posted its biggest increase since August 2019, despite fewer homes hitting the market than this time last year. Home sale prices continued to fall, down another 0.6% from the four-week period ending July 10.

"Buyers, who earlier this year had to race to beat the competition, can now take their time touring homes and perhaps even wait to see if sellers drop the price," said Redfin chief economist Daryl Fairweather. "Still, few homes are being listed, so if your dream house hits the market, you should negotiate hard, now that you have the power to. The value may fall in the near term, but if you plan to live there for five or 10 years you will almost certainly gain home equity over that horizon. Sellers, on the other hand, may want to list sooner rather than later, before prices fall more.”

Leading indicators of homebuying activity:

• For the week ending July 21, 30-year mortgage rates rose to 5.54%. This was down from a 2022 high of 5.81% but up from 3.11% at the start of the year.
• Fewer people searched for “homes for sale” on Google—searches during the week ending July 16 were down 23% from a year earlier.
• The seasonally-adjusted Redfin Homebuyer Demand Index—a measure of requests for home tours and other home-buying services from Redfin agents—was down 17% year over year during the week ending July 17.
• Touring activity as of July 10 was down 2% from the start of the year, compared to a 22% increase at the same time last year, according to home tour technology company ShowingTime.
• Mortgage purchase applications were down 19% from a year earlier during the week ending July 15 to the lowest level since April of 2020, while the seasonally-adjusted index was down 7% week over week.

Key housing market takeaways for 400+ U.S. metro areas:

Unless otherwise noted, this data covers the four-week period ending July 17. Redfin’s weekly housing market data goes back through 2015.

• The median home sale price was up 11% year over year to $389,200. This was down 1.7% from the peak during the four-week period ending June 19. A year ago the median price rose 0.9% during the same period. The year-over-year growth rate was down from the March peak of 16%.
• The median asking price of newly listed homes increased 14% year over year to $396,448, but was down 2.8% from the all-time high set during the four-week period ending May 22. Last year during the same period median prices were down just 0.8%.
• The monthly mortgage payment on the median asking price home hit $2,389 at the current 5.54% mortgage rate, up 45% from $1,650 a year earlier, when mortgage rates were 2.78%. That’s down slightly from the peak of $2,486 reached during the four weeks ending June 12.
• Pending home sales were down 15% year over year, the largest decline since May 2020.
• New listings of homes for sale were down 3% from a year earlier.
• Active listings (the number of homes listed for sale at any point during the period) rose 3% year over year—the largest increase since August 2019.
• 41% of homes that went under contract had an accepted offer within the first two weeks on the market, down from 46% a year earlier.
• 28% of homes that went under contract had an accepted offer within one week of hitting the market, down from 33% a year earlier.
• Homes that sold were on the market for a median of 19 days, up from 18 days a year earlier and up from the record low of 15 days set in May and early June.
• 49% of homes sold above list price, down from 54% a year earlier.
• On average, 7.3% of homes for sale each week had a price drop, a record high as far back as the data goes, through the beginning of 2015.
• The average sale-to-list price ratio, which measures how close homes are selling to their asking prices, declined to 101.4%. In other words, the average home sold for 1.4% above its asking price. This was down from 102.1% a year earlier.

To view the full report, including charts and methodology, please visit: https://www.redfin.com/news/housing-market-update-homes-take-longer-to-sell/

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, instant home-buying (iBuying), rentals, lending, title insurance, and renovations services. We sell homes for more money and charge half the fee. We also run the country's #1 real-estate brokerage site. 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 take an instant cash offer from Redfin or have our renovations crew fix up their home 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 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 6,000 people.

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/20220721005950/en/

Contact Redfin

Redfin Journalist Services:

Kenneth Applewhaite, 206-588-6863

press@redfin.com

Source: Redfin

FAQ

What does the July 2023 Redfin report say about home sales?

The report indicates that pending home sales fell 15% year-over-year, and homes are taking longer to sell.

How long are homes staying on the market according to Redfin?

Homes sold during the four weeks ending July 17 stayed on the market for a median of 19 days, one day longer than last year.

What is the current median home sale price reported by Redfin?

The median home sale price is $389,200, which represents an 11% increase year-over-year but is down from prior highs.

How have mortgage rates changed according to the latest Redfin data?

30-year mortgage rates increased to 5.54%, up from 3.11% at the start of the year.

What impact did the report indicate about buyer interest?

The report noted a 23% decrease in Google searches for 'homes for sale' compared to the previous year.