Homebuying demand inches up as mortgage rates ease, Redfin says
Homebuying demand has ticked up as mortgage rates have declined a full percentage point in the past month, real estate broker Redfin said. Its Homebuyer Demand Index rose ~1.5% from a month earlier, and mortgage-purchase applications rose 4% from a week ago.
"There have been a handful of pieces of relatively good news for the housing market lately, but we’re far from out of the woods," said Redfin Deputy Chief Economist Taylor Marr. "Key indicators of homebuying demand will likely be teetering on a knife’s edge with every data release that comes out related to the Fed’s path to eventually bringing rates down."
The average 30-year fixed-rate mortgage fell to 6.49% for the week ended Dec. 1 vs. 7.08% in the week ended Nov. 10.
As mortgage rates drop, price cuts are becoming less common. Just over 6% of homes for sale each week during the four weeks ended Nov. 27 on average had a price drop, down from 7.2% a week earlier and the lowest level since July, Redfin said.
The housing market is still considerably cooler than it was last year. The Redfin Homebuyer Index is still 20% lower than it was at this time last year. And touring activity as of Nov. 27 was down 53% from the start of the year, compared with a 37% decline over the same period a year earlier.
In October, pending home sales dropped for the fifth straight month.