So the mortgage interest rate has been falling for several weeks now. In fact, the mortgage interest rate is cheaper than at the same point a year ago. Now, as always with swings in the costs of money, we look at signals from home buyers who use opportunities. If we are lucky and the mortgage interest rate continues to fall, the question is whether we will soon be able to measure any turning around with the question of the Homebuyer.
Unfortunately I think we are still a way of a meaningful shift in trends in the housing demand. Last year as the rates fell from 7.5% to 6.5%, I expected some improvement in demand. But we did not see any change in the buyer’s demand statistics until the rates came closer to 6%. Last week on Housingwire’s Housing Economic Summit in Dallas, I shared the data about why I expect the same 6% threshold that we stand for in 2025.
The added wrinkle this year is that lower rates are powered by weaker assessments of the economy and jobs. According to some measures, the US economy now slows down dramatically. For example, view the GDPNOW data of the Atlanta Fed. A slower economy probably leads to cheaper mortgage interest, but it also means that fewer people are employed and the incomes stop growing.
Everyone in this country has worked in the past three years. We have had a super high employment. So when mortgage interest is cheaper, potential home buyers are quite optimistic about their personal situations and jump to take advantage. This is what happened last September. But if the mortgage interest rate is lower because unemployment peaks and the economy is shrinking, then it is still to see how much a fall in the mortgage interest rate of 50 base in a more pessimistic macro economy motivates. People have to balance the costs of money with things like job security when they buy houses.
The thing to keep in mind for the housing market when we roll in March is that the mortgage interest rate has decreased. However, the real -time sales data for at home that we follow do not yet show any response.
At the end of February, sales and house price data will even remain very weak, even in comparison with the lows of 2024.
Let’s take a look at this week’s data, starting with the active inventory of Huizen that are now for sale.
Inventory
The total available inventory fell this week to 639,000 single -family homes on the market. That is fractionally less than a week ago. There are now 28% more houses on the market than a year ago.
The purple line in this graph is 2025, you can see that there are many more houses that are not sold on the market than 2024. During the second quarter last year, the inventory rose rapidly because the mortgage interest rose quickly and peaked in May. This year, if we are lucky, the mortgage interest rate will continue to lower, so although there are now 28% more houses on the market than a year ago, that spread could be that spread of around 22%. The inventory became faster last year.
We usually concentrate on the single-family data in these videos, but it is worth pointing out that the unsold inventory of apartments and terraced houses is currently 33% more than last year. There are 193,000 on the market. Condo inventory has grown a little faster than single-family homes. Although single -family listings are still 22% less than February 2019, the unsold inventory of condos is roughly back to the old normal levels. In February 2019 there were 194,000 on the market.
In fact, you have to go back to 2016 before you can find a year with consistent more unsold apartments than we now also have in the US, while the available delivery of single -family homes this week grew a bit Kromp, the inventory of condos grew by around 1%.
What is fascinating is that 36% of all apartments and mansions are for sale in the US in Florida, and there are many apartments in Florida on the market. Of the 194,000 apartments on the market in the US, 70,000 of them are in Florida.
In most of the country, apartments are a fairly small percentage of the market. Single-family homes dominate the market, but it is worth checking up on the Condo market from time to time.
New offers
New offers also fell for the second week in a row. There are probably some weather effects in it and I expect to see a leap in the new listings volume in next week’s data.
There were just over 53,000 new entries unsold, plus another 10,000 new entries immediate sale. That comes to 2% more unsold new entries and actually 5% fewer sellers in general than in 2024. That is three of the past four weeks with fewer sellers now than in 2024.
In this graph we look at the unsold new entries. I like this display, because although there are generally fewer sellers, more of the offers have actually been added to active inventory. You can see that the purple line follows just above last year’s blue line. Every week there is a few percent more houses than we saw a year ago.
The most important collection meal of the weekly new list data is what it doesn’t. There are just not many homesellers throughout the country. Even in the slowest markets in the country, such as Florida, for example, although there are many unsold houses on the market, there is no electricity from sellers that add to it. That fact holds a lid in stock growth throughout the country.
Awaiting the sale of living
While we roll in the spring, weekly housing sales have to start climbing. This week the most new year became the most awaiting turnover, but the turnover is still a backlog at 2024.
The sale should now climb every week during the Easter holiday week. Easter is late this year, so that is something to notice for March while we see the figures coming in.
In the graph here we follow the real -time counts of the newly hanging home sales every week. The purple line simply does not show any growth in sales activity compared to 2024. As you can see, we must expect weekly rapid growth of the home sales for March when the spring season warms up.
There are now 324,000 single -family homes in contract to sell. That is 3.75% more than last week and currently runs 3% less than last year. Many sales close at the end of the month, so next week will probably fall in total in anticipation of sales, even as the weekly figures increase.
The collection meals of the hanging sales numbers is that it takes approximately 35 days on average before the sale is closed, so houses in contract will now generally close in March. We know that there are fewer houses in contract at the end of February than last year, so we have a view that the sale of home for the first quarter of 2025 will come under the first quarter of 2024.
That is contrary to our prediction for the year. When we published our Housing Wire forecasts in the fall, we expected a small growth of housing sales for 2025. Turnover could still improve somewhat if the mortgage interest continues to fall, but that change must take place quickly because Q2 is the seasonal peak for the sale of houses.
House prices
The median prize of those new current contracts came to $ 389,900 this week. That is a punch of 1% for the week and is only 2.6% larger than a year ago.
You can see that the purple line is in the seasonal climb before 2025. The best houses and most buyers are here in the spring, so the prices are higher. Given the season, I would expect that prices will step higher in the coming weeks, but there are many signals of price weakness and the low demand from the buyer. It would not surprise me if we get less seasonal lift than usual in March.
This is a national median price of all houses in the country that have been given offers and have concluded a contract this week. National prices are a bit ahead of the prices last year. Some markets have higher house prices and many have lower house prices than in the spring of 2024. As I said, the Condo inventory climbs faster than houses and the Condo prices are weaker. Nationally, the Condo prices are unchanged compared to last year. In Florida, the median price for condos is actually 4% lower last year.
This is important because local markets can behave very differently. There are many years when things move in consultation. At the moment, however, some markets have a lot of strong price rating, while others have falling house prices.
Price reductions
The leading indicators for future selling prices remain weak without signs of any change in the price reductions. The percentage of houses on the market with a price reduction of the original catalog price is now 33.7%. That is more than 50 basic points on the week and is currently remarkably higher than last year.
In the graph here, the purple line has a clear trend for 2025. There are now more houses on the market with price reductions than in recent February. Price reductions are increasing. ‘
New offers are quite low, so there is not many new inventory. Fresh inventory does not need a price reduction for a month or more.
The withdrawn entries are also quite high. For houses that are on the market and do not receive an offer, you can lower your price to stimulate the demand, or you can record the list and hopefully re -test the market in the future.
This weekend I looked at an apartment in San Francisco. It is mentioned for 15% less than for which it was sold in 2015, ten years ago. It has been withdrawn in the past year and again with a lower price 4 times a lower price. Sometimes sellers try to play the system with a withdrawal. On most MLSS, if the property may have been off the market for 30 days, they will reset the days on the market and the original catalog price. In the Altos data we follow the total days on the market. So while this apartment is officially shown as a new list, we show almost 400 days on the market in the Altos data. At some point this real estate will be a purchase. It is a super cool space and it will be fascinating to see the price.
That is all the time we have for today’s data. If you have to communicate with your buyers and sellers about this market, you must participate with us Altos Research.
