The housing market has 39% fewer homes for sale compared to before the pandemic, according to a ThursdayThe issue is unlikely to ease anytime soon, as the total number of homes for sale dropped 6% year over year in the four weeks leading up to June 11, the report said, marking the largest drop in 13 months. And new home listings fell 23%, the 10th consecutive month of double-digit declines, amid a slump in homebuilding.
Mortgage rates are now hovering close to 7%, nearly double where they were at in 2021, when ultra-low rates fueled a home-buying boom. And don't expect much relief, if at all, in the near future, as the Federal Reserve stays hawkish. "The Fed's indication that there are more rate hikes to come is not what homebuyers want to hear. It's likely to keep mortgage rates elevated and may even push them up a bit," said Redfin Economics Research Lead Chen Zhao."People who are sitting on the sidelines, waiting for mortgage rates to decline, should know that's unlikely to happen in the foreseeable future.
High mortgage rates have discouraged homeowners from selling or moving so they can hold onto lower payments, Redfin said. In fact, a separate Redfin report found thatThese numbers are the primary reasons behind the tight inventory, in Redfin's view, and the lack of options for buyers could meanTo be sure, there's still demand on the market.
"For new home buyers, this is the worst situation since the end of the Great Recession," Seiler said.
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