Pending home sales drop 32.1 percent in October, the steepest year-over-year decline in nine years MABA Massachusetts RealEstate FirstTimeHomeBuyers

 Pending home sales posted a record drop last month, while the number of cancellations and price cuts hit a record high, according to a new Redfin report. October pending home sales fell thirty two point one percent from last year, the largest decline since 2013. During that same period, seventeen point nine percent of all homes that went under contract had their purchase agreements fall through and twenty three point nine percent of homes on the market had price drops, nearly doubling from 2021. But there is some good news, according to the report: this historic slowdown could ease in the coming months if inflation continues to cool.

 October also saw the steepest decline in new listings since the start of the pandemic, falling twenty four percent year over year. Redfin attributes that drop to more potential sellers choosing to stay put due to higher mortgage rates. October’s thirty year-fixed mortgage rate was six point nine percent, a three point eighty three percentage point increase from last year and the largest monthly year-over-year increase since 1981. Redfin economics research lead Chen Zhao said the Fed’s actions to curb inflation are causing the housing market to slow at a pace not seen since the financial crisis.

 “There are already early but promising signs that inflation is cooling, which caused mortgage rates to drop last week,” Zhao said. “If that progress continues, buyers who recently backed out of deals may return to the market and sellers may be less inclined to slash their prices.” October’s median home sale price fell one point four percent month over month to $397,549 but was up four point nine percent from 2021. Meanwhile, homes stayed on the market for twenty one days longer than they did a year ago at a median of thirty five days, with only forty four point six percent of them facing competition. Last October, sixty seven point three percent of homes were in bidding wars.

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