US home listings fell 21% in April, with new homeowners reluctant to be locked into high rates
US home listings fell 21% in April, with new homeowners reluctant to get ‘tied’ to high mortgage rates
- Housing supply is almost a third lower than in the same period in 2019
- Experts suggest the pandemic boom market is finally settling down
- The high mortgage interest since last September is deterring potential buyers
Home sales fell 21 percent in April in the United States as new would-be homeowners appear fearful of being “locked in” to higher mortgage rates.
The number of new listings continued a trend as listings fell by 31 percent compared to 2019. The 2019 figure was used as a benchmark, just as it was before the pandemic.
In April 2021, the housing supply had increased by 41.5 percent compared to 2019.
Mortgage rates have risen by more than 6 percent since September 2022, finally calming down the once booming housing market.
Experts suggested that those high mortgage rates deter new buyers, who don’t want to be stuck with more than six percent. Higher mortgage rates mean homeowners pay more interest over the life of the loan.
Home sales fell 21 percent in April in the United States as new would-be homeowners appear fearful of being “locked in” to higher mortgage rates. The graph shows that the numbers go from a 41.5 percent year-over-year increase in April 2021 to a 21.3 percent decline in April 2023. The 0 percent line is from April 2019, before the pandemic, was used as baseline
The number of homes under contract fell by 23 percent in April compared to the same month last year.
The median asking price for a home was $430,000 in April broker. com. That was 2.5 percent more than a year ago and the lowest growth rate since April 2020.
“This means that on a typical April day, there are still fewer homes available to buy than a few years ago,” said Danielle Hale, the website’s home buying expert.
In addition to deteriorating conditions for buyers, sellers may not find exactly what they want in the marketplace.
By April 2023, 12.2 percent of listed homes had price cuts, with Hale suggesting the market was finally returning to pre-pandemic levels.
Homes have been on the market for an average of 49 days in the past month, an increase of 17 days compared to last year.
Markets that boomed in housing during the pandemic, bringing in more new arrivals than other cities, are now seeing prices fall.
The largest declines occurred in Austin (8.8 percent year-on-year), Las Vegas (7.1 percent) and Houston (4.6 percent).
The highest year-over-year price increases occurred in Memphis (31.7 percent), Milwaukee (21.7 percent), and Kansas City (21.1 percent).
New listings continue what appears to be a trend as listings are down 31 percent from 2019
Mortgage rates have risen more than six percent since September 2022, finally calming down the once booming housing market
Experts suggest that those high mortgage rates are deterring new buyers, who don’t want to be stuck with more than six percent
In a poll for the sitemore than 33 percent of potential sellers cited their reasoning as wanting to take advantage of the current market.
Hale said that despite the current market situation, sellers with long terms of equity in their properties can still get what they wanted.
“Sellers who have built up equity are better positioned to find their next home in a cooling market,” she said. But “maybe they should temper expectations for the sale of their current home.”
However, according to economist Jiayi Xu, the days of the home sales boom will not be seen again.
“Many sellers want to wait for house prices to rise again,” says Xu. ‘Not given all the uncertainties in the housing market [think] that will happen soon.’