Elevated mortgage rates continue to dampen homebuying demand nationwide, but low inventory is keeping competition tight among those still persevering in the for-sale market. New listings fell 21.8% year-over-year during the four weeks ending April 2, one of the biggest drops since the start of the pandemic.
With fewer homes to choose from, buyers are taking a much faster approach to home purchases. Of all homes going under contract, nearly half are doing so within two weeks, Redfin reports.
“Elevated mortgage rates are perhaps an even bigger deterrent for would-be sellers than for would-be buyers. Giving up a 3% mortgage rate for one in the 6% range is a tough pill to swallow,” said Redfin Deputy Chief Economist Taylor Marr. “Today’s serious homebuyers have grown accustomed to the idea of a 5% or 6% rate and have adjusted their budgets accordingly. The lack of homes hitting the market explains why the market is moving fast even though sales are still down. The lack of new listings is also one reason why sales are down: Buyers can’t buy if sellers don’t want to sell.”
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