High Housing Payments Slowing Sales
Redfin said daily average mortgage rates should be declining on less aggressive national economic policies. The average home is selling in 52 days.
SEATTLE – The median U.S. monthly housing payment is $2,686, the highest level in nearly seven months, as of the four weeks ending January 19. Housing costs are high because of rising mortgage rates and home prices: The weekly average mortgage rate is 7.04%, the highest level since May, and the median U.S. home-sale price is up 5% year over year.
High housing costs are one factor keeping many would-be homebuyers on the sidelines. Pending home sales are down 10.1% annually, the biggest decline in more than a year, and Redfin’s Homebuyer Demand Index – a measure of tours and other buying services from Redfin agents – is near its lowest level since June. Homes are also selling relatively slowly. The average home is selling in 52 days, the longest span in two years.
Other factors pushing down pending sales are extreme cold and snow in some parts of the country, wildfires in Southern California and limited new listings. Some prospective buyers also likely held off in the run-up to President Trump’s inauguration to wait and see if the new administration would take immediate action on housing.
There are signals homebuyers could get cost relief soon. Daily average mortgage rates started coming down last week after a softer-than-expected CPI report, and Redfin economists expect rates to decline more if President Trump continues to signal he will be less aggressive on tariffs than expected. And sale-price increases may be losing momentum; the 5% year-over-year increase is the smallest since October.
Metros with biggest year-over-year increases in median sale price: Fort Lauderdale, FL (12.1%)
Metros with biggest year-over-year decreases in median sale prices: Tampa, FL (-2.8%)
Metros with biggest year-over-year decreases in pending sales: Miami (-20%)
Source: Redfin
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