It looks as if rising rates are having their desired effect on the market. homebuyer competition has fallen for the first time in six months, according to Redfin’s latest report…(Redfin)
- M-O-M: Homebuyer competition fell 1.7 percentage points to 65.0% in March, the first decline in six months.
- Y-O-Y: Competition was still up from last year when 62.2% of buyers face competition.
Three of the top six most competitive markets are, not surprisingly, in California. San Jose was number one with 79.8% of buyers facing competition followed by San Diego (78.1%) and San Francisco (76.4%) at 5 and 6, respectively.
- Boston, MA was a close second with 79.0% of buyers facing competition followed by Providence, RI (78.3%), and Worcester, MA (78.2%).
Daryl Fairweather, Redfin Chief Economist, said they expect competition to drop over the coming months…
- “We expect bidding wars to ease further in the coming months as rising mortgage rates price more buyers out of the market. That should provide some relief for people who can still afford to buy, as they’ll likely face fewer competing offers and may no longer need to offer drastically over the asking price in order to win.”
Redfin wasn’t the only company showing signs of a slowdown. Altos Research releases its weekly data and they also have some data trending in the direction of a slowdown…(Altos Research)
- PRICES: Home prices were unchanged this week at $420,000. This is the first tie since January that prices did not rise.
- INVENTORY: This week’s inventory level is up almost 2% to 275,000 single-family homes unsold on the market.
- TIME ON MARKET: Nationally, time on the market had a slight uptick this week to 28 days.
None of this is definitive or necessary going to continue. But, looking at these companies both reporting data that things are cooling in housing is a positive move that will keep me optimistic.