Home sales improve as more buyers return to the market MABA MassachusettsRealEstate FirstTimeHomeBuyers MassBuyerAgents

 Pending home sales improved in January as more buyers returned to the market at the start of the year. According to a new Redfin report, January pending home sales had their smallest year-over-year drop in more than three months falling twenty six point two percent in the four weeks ended January 22, 2023. This comes just one month after pending sales started to rise month over month in December 2022. The report found homebuyer demand is on the rise, as mortgage applications rose twenty eight percent since November and more prospective buyers are scheduling home tours.

 During the week ended January 21, 2023 Redfin found Google searches for “homes for sale” were up forty percent from their November low but down twenty one percent from last year. However, that doesn’t mean there’s a lot of change in home prices. While demand is growing, inventory is still an issue. New-home listings fell eighteen percent from last year, and while Redfin notes that’s a smaller drop than they’ve seen in recent weeks, prices are still holding steady. Redfin economics research lead Chen Zhao says homebuyers are feeling more confident as mortgage rates drop closer to six percent and the economy shows surprising resilience.

 “Steadily cooling inflation is likely to prevent mortgage rates from jumping back up,” Zhao said. “When rates were seesawing up and down in the fall, many buyers dropped out because they could wake up the day after finding their dream home to a three-digit increase in their potential monthly payment. Now they have a better sense of how far their budget will go in which neighborhoods and which homes they can afford.” Thirty-year mortgage rates fell to six point thirteen percent for the week ending January 26, 2023 the lowest they’ve been since September 2022. The daily average was six point eighteen percent on January 25, 2023. The drop in mortgage rates brought more buyers to the market, as mortgage applications rose three percent from the previous week and were up twenty eight percent from early November.

 The lower rate brought the average monthly mortgage payment on a median-priced home to $2,323, down almost $200 from October’s peak. Year over year, mortgage payments were up twenty nine percent. In the four weeks ended January 22, 2023 active listings rose twenty three point six percent from last year. Meanwhile, new listings fell eighteen point three percent from last year, the smallest decline in three months. The median asking price of a home rose three point eight percent from 2022 to $367,450. Meanwhile, the median sale price had its biggest gain in over a month, increasing one point one percent to $349,950.

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