Ahead of Fed hike, homes selling at a record pace: Massachusetts Homeownership Homebuyers

 The pace of home sales has reached a fever pitch ahead of an expected Fed rate hike on Wednesday. Of the homes that went under contract during the four weeks ended March 6, fifty eight percent had an accepted offer within the first two weeks of going on the market, and forty five percent had an accepted offer within just one week, Redfin reported. “Homebuyers are in a frenzy,” Redfin deputy chief economist Taylor Marr said. “Buyers are reacting to changes in mortgage rates but are so far unfazed by the war in Ukraine, stock market volatility and rising oil prices.

 However, these risks are reaching levels that could be dangerous for the economy, and the Fed is on the cusp of raising rates further to cool inflation. The silver lining for housing is that the spike in mortgage rates has paused for now.” Other housing metrics have reached record highs ahead of what economists expect to be a 0.25 percent increase in the federal funds rate, according to Redfin data.

 The median home sale price of three hundred sixty nine thousand one hundred twenty five dollars represented a record high, having risen sixteen percent year over year and thirty four percent from the same time in 2020. The median asking price was also at a new high of three hundred ninety three thousand two hundred fifty dollars following a fourteen percent year over year increase, Redfin noted. The monthly mortgage payment on the median asking price home hit a record high of two thousand and forty eight dollars based on the current 3.85 percent mortgage rate. This represented a twenty two percent gain from a year earlier, when mortgage rates were 3.05 percent, and a thirty three percent increase from the same period in 2020, when rates were 3.36 percent.

 Homes that sold were on the market for a median of twenty five days, compared to thirty four days over the same period in 2021 and fifty three days in 2020, and forty six percent of homes sold above list price, compared to thirty six percent a year earlier and twenty two percent in 2020. The average sale to list price ratio increased to 101.1 percent, meaning the average home sold for 1.1 percent above its asking price. This was up from an average sale to list price ratio of 99.7 percent in 2021 and 98.1 percent in 2020.

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