Monthly Payments Drop, Bringing Some Back to Market

According to a new report from Redfin, the median U.S. mortgage payment dropped $372 to $2,361 during the four weeks preceding the new year, a 14% drop from its all-time high in October resulting in a 14% drop. 

The market is beginning to see early-stage homebuying demand return as buyers take advantage of dropping mortgage rates and additional inventory that has hit the market in the last few weeks. Redfin’s Homebuyer Demand Index—a seasonally adjusted measure of requests for tours and other homebuying services from Redfin agents—is up 10% from a month ago to its highest level since August. Pending sales are down just 3% annually, the smallest decline in two years. 

“There have been more tours and more offers on my listings since mortgage rates started declining,” said Las Vegas Redfin Premier agent Shay Stein. “It’s all about perspective: Two years ago, buyers would have cried about a 6% mortgage rate. Now, they’re happy they’ve dropped down to the mid-6’s.” 

By the numbers according to Redfin: 

• Median Sales Price: $363,371, a 4.4% year-over-year increase 
• Median Asking Price: $359,236, a 4.3% year-over-year increase 
• Median Monthly Mortgage Payment: $2,361, a 5.4% year-over-year increase 
• Pending Sales: 52,552, a 3% decline year-over-year 
• New Listings: 44,297, up 9.5% year-over-year 
• Active Listings: 789,516, down 3.9% year-over-year 
• Months of Supply: 3.8 months 
• Median Days on Market: 41, down two days year-over-year

Looking at the top-50 metropolitan areas, the median sales prices increased the most in the cities of: Newark, New Jersey (18.2% increase in median sales prices); Anaheim, California (18.1%); West Palm Beach, Florida (15.2%); Fort Lauderdale, Florida (15.1%); and Miami (11.7%). Metropolitan areas that saw the biggest decreases were: Fort Worth, Texas (3.1% decrease); Austin, Texas (-1.7%); San Francisco (-1.1%); and Denver (-0.4%). 

Click here to view Redfin’s data in its entirety.