Mortgage rates jumped to their highest level in 20 years on Aug. 17, averaging 7.09% for a 30-year fixed-rate home loan, and home prices followed the same upward trajectory during the final weeks of a slow summer market. Higher housing costs are stalling both buyers and sellers and leading to a dearth of new inventory. The total number of homes for sale fell 8.6% year-over-year, while new listings dropped 8.1% annually, notching their 58th straight week of steady declines, according to Realtor.com.
Despite dreary homebuying conditions at the end of summer, housing experts such as Realtor.com economic data manager Sabrina Speianu say the market is headed in “a more buyer-friendly direction” ahead of fall.
Still, homebuyers in desperate need of good news can hang on to this nugget of hope: Home prices are unlikely to surpass the June 2022 high of $449,000. In fact, they’re bound to start going down seasonally as we head toward the end of the year.
“The median listing price has begun its typical seasonal decline,” says Speianu.
Here’s why: While fresh listings are down annually, that gap has been shrinking.
“This week’s data shows a 5.9 percentage point improvement over last week,” says Speianu.
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