Home sales decline as buyers await lower mortgage rates, new NAR rules, election outcome MABA MassachusettsRealEstate FirstTimeHomeBuyers MaBuyerAgent

 While the average monthly housing payment in the U.S. fell to its lowest level since the start of the year, it isn’t improving sales, as potential buyers are holding out for lower mortgage rates, according to a new Redfin report. During the four weeks ended Sept. 1, the median U.S. monthly housing payment fell to $2,534, the lowest since January and almost $300 lower than April’s all-time high. Home sales are yet to improve despite declining housing payments. In fact, they are also declining. Year over year pending home sales fell eight point four percent , marking the biggest decline in nearly a year.

 Redfin attributes the drop to homebuyers still priced out of the market sitting on the sidelines waiting for mortgage rates to fall even more. Additionally, Redfin said its agents are hearing that some buyers are postponing purchases until they better understand the new NAR rules on real estate agent fees, while others are waiting until after the presidential election. Redfin’s Van Welborn, an agent in Phoenix, said there is demand for desirable, move-in ready listings, but some house hunters are in a holding pattern because the industry is in flux.

 “Some buyers are waiting to see how the NAR rules shake out before they get serious,” Welborn said. “Others believe rates will come down more substantially after the Fed cuts interest rates later this month, and they’re waiting for that to happen before they buy.” And even though potential homebuyers are holding out for a lower mortgage rate, they may not fall much lower, the report found.

 “That’s because markets have already priced in interest-rate cuts from the Fed, starting in September and going through 2025,” the report said. “If the cuts are smaller and slower than expected, mortgage rates would rise from where they are today. “If the Fed cuts faster than expected, mortgage rates are likely to decline further. If rates do fall substantially more than they already have, that could push up demand, competition and home prices.” That doesn’t mean homebuyers aren’t looking and aren’t making moves to buy.

 According to Redfin’s Homebuyer Demand Index, requests for tours and services from Redfin agents are up four percent from last month and near their highest level since May, while mortgage applications are up three percent week over week. New listings rose three point seven percent from last year, which Redfin said is on par with the increases it has seen over the past few months. Meanwhile, total listings are up sixteen point six percent, which Redfin attributes to homeowners who weren’t ready to let go of their low mortgage rates are now selling as rates come down.

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