On September 18th, the Federal Reserve Bank dropped its benchmark rate for the first time since 2020, and many analysts expect further cuts before the end of the year. Inflation has fallen to its lowest reading since early 2021, and mortgage rates are now the lowest since February 2023. Stock markets have been volatile since mid-July, but the S&P 500 & Dow hit new highs on September 19th.
- National sales activity was relatively weak in August 2024: Existing-home sales declined 3.1% from July and 5.7% from August 2023. But sales in August mostly reflect offers accepted in July before many of the positive economic developments mentioned above.
- Year over year, the median single-family-home sales price and the median condo/co-op price in August were up 2.9% and 3.5% respectively: Both have declined from all-time highs hit in June, which is a typical seasonal trend.
- The number of active listings continued to climb, rising 23% from August 2023 to the highest count since autumn 2020, and price reductions on active listings rose 37% year-over-year. These statistics reflect significant 2024 changes in market supply and demand dynamics.
- Approximately 60% of sales went into contract in less than 1 month (vs. 72% in August 2023), 20% sold over list price (vs. 31% last August), and 26% were purchased all-cash (vs. 27%). The median days-on-market to acceptance of offer was 26 days (vs. 20 days last year), and sold listings received an average of 2.4 offers (vs. 3.2). 26% of buyers were purchasing their first home; 7% of homes bought were intended for vacation use; and 8% of buyers purchased without seeing the property in person. Distressed-property sales made up only 1% of sales.
- Approximately 18% of August buyers waived their inspection contingency, and 20% waived the appraisal contingency. 14% of June-August contracts saw delays in scheduled close of escrow, and 5% of contracts were terminated before completion of sale.
“Mortgage rates continued declining towards the six percent mark, reviving purchase and refinance demand for many consumers. While mortgage rates do not directly follow moves by the Federal Reserve, this first cut [on 9/18/24] in over four years will have an impact on the housing market…[and] rates will likely fall further, sparking more housing activity.”
Freddie Mac (FHLMC), 9/19/24
“Home sales were disappointing again in August, but the lower mortgage rates coupled with increasing inventory is a powerful combination that will provide the environment for sales to move higher in future months. The rise in inventory…implies home buyers are in a much-improved position to find the right home and at more favorable prices. However, in areas where supply remains limited…sellers still appear to hold the upper hand.”
Lawrence Yun, Chief economist, National Association of Realtors, 9/19/24
“The CoreLogic HPI Forecast indicates that [national] home prices will…increase by 2.2% on a year-over-year basis from July 2024 to July 2025...Although this is the 150th consecutive month that the U.S. has seen year-over-year home price gains, monthly home price growth is starting to slip, and annual forecasts are showing smaller anticipated gains.”
“Persistent home price growth has continued to fuel home equity gains for existing homeowners [and] the substantial accumulation of home equity…As a result, mortgage delinquency rates have remained at historical lows.”
Selma Hepp, Chief market analyst, CoreLogic, September 2024 Reports
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