Home seller confidence is growing and the number of new homes on the market is recovering closer to levels seen last year, according to Zillow’s Weekly Market Report. Still, buyer demand is outpacing this new supply as newly pending sales are up big in year-over-year numbers, driven partly by mortgage rates that fell even further this week.
In Phoenix, newly pending sales are up 6.7 percent year over year, new listings are down 6.5 percent year over year, and total for sale listings are down 26.2 percent year over year. The median sales price is $315,625, an increase of 9.4 percent year over year.
Buyer demand is holding strong
• Newly pending sales were up 16.5% from the same week last year as strong buyer demand is continuing into the late summer. That’s the biggest year-over-year jump since mid-February, before the coronavirus pandemic took hold.
• Home sellers that accepted an offer last week typically did so after 13 days, which is 13 days faster than a year ago.
More sellers are entering the market, but demand is still outpacing supply
• New for-sale listings were down 10.6% year over year last week. That’s the narrowest gap since late March, a possible sign that sellers are belatedly entering the market as home shopping season extends later in the year than usual.
• Fannie Mae’s National Housing Survey shows confidence is growing that now is a good time to sell a home. In July, 45% of respondents shared that belief, up from 41% in June and a recent low of 29% in April.
• Still, due to the pace of pending sales, total for-sale inventory fell further below last year’s level. As of last week, there were 28.9% fewer homes on the market than a year ago.
Last week marked biggest year-over-year list price growth since summer 2019
• The median U.S. list price is $345,255, 8.3% higher than a year ago. That’s the biggest annual change since the week ending July 13, 2019.
• The share of listings with a price cut is holding steady at 4.2%, which is down from 5.7% at this time last year.
• In the week ending July 11, the median sale price of U.S. homes was $277,500, a 5.1% year-over-year increase.
Mortgage rates dip lower after FHFA fee delay
• Mortgage rates listed by third-party lenders on Zillowii fell sharply midweek after the Federal Housing Finance Agency announced a delay in its new 0.5% fee on some refinances. The Adverse Market Refinance Fee, which applies to all mortgage refinances serviced by government entities, will be delayed to December 1, rather than September 1.
• Additionally, Federal Reserve Chairman Jerome Powell formally announced a policy shift that will allow for higher inflation in some cases, which is expected to keep interest rates low for a sustained period. The immediate impact on mortgage rates will likely be negligible, and longer-term it’s possible this actually moves mortgage rates higher depending on other factors, such as the pace of the economic recovery.