Home-price growth slows as early-stage demand levels off MABA Massachusetts RealEstate FirstTimeHomeBuyers

 Home-price growth slowed to three percent last month, and that’s not the only metric decelerating in today’s market. Inflation is also starting to slow which is helping bring down mortgage rates. A new report from Redfin found the median home sale price fell eight point four percent from its June all-time high, compared to home prices rising half a percent from the same period a year ago. During the four-weeks ended Nov. 6, home-sale prices rose three point two percent on an annual basis, the smallest increase since July 2020. These changes are reflected in the latest market activity, as early-stage homebuyer demand started leveling off and mortgage applications rose after a month and a half of declining.

 Redfin deputy chief economist Taylor Marr says the recent report that the overall inflation rate is starting to back off makes it even more likely the Fed will slow rate increases. “The inflation news is already helping to bring daily mortgage rates down,” she said. “However, Chair Powell has indicated that inflation would need to slow for several consecutive months before the Fed would lower its target for how high it raises rates next year.” Marr added that still-high home prices are propping up inflation, but things are changing fast.

 “The buyers who remain in this market are likely getting much better deals than the median asking or sale price reflects,” Marr said. “The typical home now sells for less than asking, price drops remain at a record high, and seller concessions are becoming increasingly common.” For the week ended Nov 6, 2022 pending home sales fell thirty four percent from last year, marking the largest decline since January 2015. Mortgage rates rose to seven point eight percent in the week ended Nov 10, 2022 while mortgage applications rose one percent from the week before. Purchase applications were down forty one percent from last year.

 Redfin found fewer Google searches for “homes for sale” during the week ended Nov 10, 2022 down twenty eight percent from last year, but up a point from the week prior. Its Homebuyer Demand Index, which measures requests for tours and other services, was up two point eight percent from the previous week, but down thirty four percent from last year. In the four weeks ended Nov 6, 2022 active listings rose ten percent from last year, while new listings were down seventeen percent from last year. The median asking price rose seven percent from 2021 to $372,475, but was down seven percent from a record high of $399,975 in May. Meanwhile, the median sale price increased three percent year over year to $359,250  the slowest sale-price growth since the pandemic began.

 Thirty-four percent of homes that went under contract had an offer within the first two weeks, showing little change from the previous four weeks but down forty percent from last year. Twenty-eight percent of homes sold above list price, down from forty three percent last year and the lowest since July 2020. The report also noted the monthly mortgage payment on a median asking-price home was $2,524 at the current seven point eight percent mortgage rate. That was up fifty point seven percent from last year’s $1,687 when mortgage rates were two point ninety eight percent and up from a recent low of $2,203 in August 2022.

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First Time Home Buying in Massachusetts

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