🏡 Sales Slump: Sales of previously owned homes saw a 2% decline in September from August, reaching a seasonally adjusted annualized rate of 3.96 million units. This downturn marked the slowest sales pace since October 2010, during the Great Recession’s foreclosure crisis. For context, two years prior, with mortgage rates around 3%, home sales were at a 6.6 million pace.
💰 Affordability Ailments: The average rate on a 30-year fixed mortgage hovered around 8%. Lawrence Yun, NAR’s chief economist, pointed out that limited inventory and low housing affordability continued to stifle home sales. He added that the Federal Reserve’s interest rate hikes amidst softening inflation and weakening job gains were concerning. Mortgage demand is at the lowest level since 1995, according to the Mortgage Bankers Association.
📉 Inventory Issues: At September’s end, there were 1.13 million homes available for sale, a drop of over 8% from the previous year. The median price of a home sold in September stood at $394,300, a 2.8% increase year over year. Due to limited supply, roughly 26% of homes sold above their list price, sparking bidding wars.