Recent reports have shed light on significant developments in the housing market that both buyers and sellers need to be aware of.
New Listings in Sharp Decline
In a startling revelation, new listings in the housing market have plummeted by a staggering 27 percent since June of the previous year. This marks the most substantial annual drop in listings since the onset of the pandemic. The latest housing market report from Redfin highlights this downward trend, showcasing a considerable impact on the market's inventory. It's noteworthy that this decline hasn't just affected Salem, but is a nationwide phenomenon.
Listings Shrink Across Nation
Cities across the nation have been grappling with dwindling new listings. The severe decline is particularly pronounced in metropolitan areas like Las Vegas and Phoenix, where new listings have plummeted by over 43 percent compared to the previous year. Even on the West Coast, renowned cities like Seattle, Oakland, and Riverside have witnessed a significant drop of at least 37 percent in new listings year-over-year.
Rise in Homebuyer Mortgage Demand
Despite these challenges, there is a silver lining to be found. Homebuyer demand for purchase loans has surged to its highest level since May. According to the Mortgage Bankers Association (MBA), the demand for purchase mortgages saw a 3 percent increase in the past week alone. While there's a year-over-year decline of 21 percent, this recent uptick indicates a resilient buyer sentiment. Additionally, there's also been a simultaneous increase of 3 percent in refinance applications week over week, though these numbers remain down 32 percent from a year ago.
Upcoming Economic Factors at Play
The housing market is not immune to larger economic trends. Federal Reserve policymakers are expecting two more rate increases this year, with potential rate adjustments in the coming years. Economists at both the MBA and Fannie Mae predict varying trajectories for mortgage rates. While the MBA forecasts a drop in 30-year fixed-rate mortgage rates to an average of 5.8 percent by the end of this year, Fannie Mae suggests a more gradual decline not expected until the third quarter of 2024.
Our Commitment to You
In these dynamic times, having a dedicated and knowledgeable team on your side can make all the difference. Whether you're looking to buy or sell, our experts at Legacy Real Estate are here to guide you through the nuances of Salem's real estate market. Contact us today to ensure you stay ahead in these ever-evolving times.
Source: Houston, Daniel. New listings plummet 27%, marking biggest annual fall since pandemic. Inman Hot Sheet, June 29 2023.