Townhouse for sale in the Upper East Side neighborhood of New York City.
Adam Jeffrey | CNBC
Some of the heat is coming from home prices, although they are still higher than they were a year ago.
Several new reports show that price gains are shrinking and home sellers are starting to give up after the spring market slump.
For the first time since the start of the COVID-19 pandemic, when home sales halted, the typical home sold for slightly less than the asking price — 0.3% less — during the four weeks ending June 23, according to the real estate report. Redfin Financial Brokerage. A year ago at that time, the typical home sold at list price. Two years ago, it was about 2% higher than the list price.
This does not mean that the housing market is collapsing. Just under two-thirds of homes still sold for more than their asking price last month; However, this is the lowest share since June 2020. While most sellers are still offering their homes at higher prices than similar homes sold a year ago, some admit they simply can’t get those prices.
Mortgage rates remain stubbornly high, with the average 30-year fixed mortgage rate remaining just above 7% for the third month in a row, according to Mortgage News Daily.
The widely watched S&P Case-Shiller Index showed that home prices in April rose 6.3% compared to April 2023. May prices continue this trend. Home prices are now 47% higher than they were in early 2020, and the median sale price is now five times the median household income.
CNBC got an exclusive early look at home price data coming out next week from a different index by ICE Mortgage Technology. It shows that annual house price growth fell to 4.6% in May from 5.3% in April. This is the slowest growth rate in seven months.
Supply began to increase, slowing prices. According to Realtor.com, total active listings are now 35% higher than they were at this time last year. However, even after recent growth, inventory is still more than 30% below typical pre-pandemic levels.
“Some buyers think they can get a deal because they hear the market is in good shape, and some sellers think every home will sell for top dollar regardless of its condition,” Mary Krethoff, a Redfin agent in Los Angeles, said in a statement. Depends on the house and location.
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