{"id":76202,"date":"2023-05-11T11:04:27","date_gmt":"2023-05-11T18:04:27","guid":{"rendered":"https:\/\/www.redfin.com\/news\/?p=76202"},"modified":"2023-05-11T11:04:27","modified_gmt":"2023-05-11T18:04:27","slug":"housing-market-update-limited-listings-few-fast-home-sales","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/news\/housing-market-update-limited-listings-few-fast-home-sales\/","title":{"rendered":"Housing Market Update: It’s Hot And It’s Cold; Limited Listings Lead to Few But Fast Home Sales"},"content":{"rendered":"

Fewer homes are selling than usual this spring\u2013but the ones that are changing hands are going fast, with a small pool of buyers circling an even smaller pool of listings. This week\u2019s inflation report, which shows slow but steady progress on easing price gains, confirms it\u2019s likely the Fed will pause on interest-rate hikes next month.<\/span><\/i><\/p>\n

Limited inventory and elevated mortgage rates continue to suppress U.S. home sales as we enter the heart of spring, typically a hot homebuying season. This week\u2019s inflation report shows a <\/span>slight slowdown<\/span><\/a> in price gains, confirming that mortgage rates are likely to stay about where they are for the next several months. That\u2019s because the Fed\u2019s <\/span>interest-rate hikes<\/span><\/a> are working as intended to ease inflation, albeit slowly. That means they probably won\u2019t hike or cut interest rates at their next meeting in June.\u00a0<\/span><\/p>\n

New listings of homes for sale dropped 19% year over year during the four weeks ending May 7, contributing to an unseasonal monthly decline in total inventory. There were 16% fewer pending home sales than a year earlier, reflecting the lack of listings and the group of would-be buyers who have been priced out by 6%-plus mortgage rates and record-high monthly payments.\u00a0<\/span><\/p>\n

But despite the inventory crunch, pending sales have increased over the last week, as they typically do this time of year. Additionally, mortgage-purchase applications are <\/span>up 5%<\/span><\/a> on a seasonally adjusted basis. The pool of buyers is small but determined, with nearly half of the homes that <\/span>do <\/span><\/i>sell doing so within two weeks. That share has increased over the last month, which isn\u2019t typical for this time of year.\u00a0<\/span><\/p>\n

\u201cThis spring\u2019s housing market is hot but cold, with scant listings making it less active than usual but fast and competitive at the same time.\u00a0 The good news is that buyers are out there, trying to find a seat in a game of musical chairs.\u00a0 The bad news is there aren\u2019t enough chairs,\u201d said Redfin Deputy Chief Economist Taylor Marr<\/a>. \u201cA lot of potential home sales are locked up until mortgage rates come down to a level for which current owners would be willing to trade in their 3% rate. The problem is that\u2019s unlikely to happen anytime soon,\u00a0 as although inflation is steadily coming down from last year\u2019s record-high levels, it\u2019s still above target.\u201d<\/span><\/p>\n

Today\u2019s housing market is local, with different parts of the country experiencing different trends<\/h3>\n

While a shortage of listings and few but fast-moving sales characterize the U.S. housing market as a whole, each metro area is unique.<\/span><\/p>\n

Austin, TX <\/span>Redfin Premier<\/span><\/a> agent Gabriel Recio<\/a> reports that homebuying demand has picked up this spring, but there are enough homes for sale that he\u2019s not seeing much competition. Pending sales and new listings are each down about 9% from a year earlier in Austin, smaller declines than most metros, and prices are down the most in the country (-18% YoY).\u00a0<\/span><\/p>\n

\u201cI\u2019ve seen an influx of homebuyers enter the market over the last month,\u201d Recio said. \u201cThe rejuvenation is partly because people got tired of waiting for mortgage rates to come down and partly because they feel it\u2019s a good time to get a home without much competition. Many of today\u2019s buyers are people moving in from other states and some are investors.\u201d<\/span><\/p>\n

In Jacksonville, FL, <\/span>Redfin Premier<\/span><\/a> agent Heather Kruayai<\/a> says sellers are subdued\u2013and so are a lot of prospective buyers. \u201cHomeowners are locked in by low mortgage rates. They\u2019re not selling unless they need to move for something like a new job or another major life change,\u201d she said. \u201cHomes that do go on the market are selling quickly if they\u2019re low-priced starter homes, but middle-of-the-road and expensive homes are sitting.\u201d\u00a0<\/span><\/p>\n

Leading indicators of homebuying activity:<\/span><\/h2>\n