Home sale prices shot up from June into the first week of July, according to a new report from Redfin.
The median U.S. home-sale price hit an all-time high of $397,482 during the four weeks ending July 7, up 4.7% year over year – the biggest increase in over four months. This also marks the ninth straight week that the median sale price hit a new record high.
Prices remain stubbornly high this season, despite elevated mortgage rates pushing down home buying demand. Pending home sales are down 3.5% YOY and mortgage-purchase applications are down 13%. Economists attributed this in part to historically low inventory levels pushing up prices and pushing down sales. However, given the fact that sale prices are negotiated a month or two earlier than they are published, there are signs that price growth may lose momentum soon.
In fact, this is the first July in four years that typical homes are selling below asking price – 0.4% less to be exact. Just 32% of homes sold above asking price at the start of the month, down from 36% a year ago and the lowest share at this time of year since 2020.
“Homes are sitting longer than they usually do this time of year, which has led to some – but not all – homes selling for a little bit less,” said Julie Zubiate, a Redfin Premier agent in the Bay Area. “The longer rates stay high, the pickier buyers are getting. Buyers will jump ship or try to negotiate the price down with any sort of tiny problem; sellers should take the time to prep, price and promote their homes correctly to find the right buyer. That being said, there is one segment of the market that is still moving fast, with homes going over asking price with multiple offers: move-in ready homes with big backyards located in desirable school districts.”
Buyers can take relief in the fact that inventory is rising on a year-over-year basis, with new listings up 7.3% YOY, and the total number of homes for sale up by 18.3%.
