The national median home price surged to $263,800 in June, a record high, according to the National Association of REALTORS®. That has prompted some buyers to hit the pause button.
Buyers were still requesting tours at the same rate in June; however, 11 percent fewer buyers were submitting an offer, according to a recent survey by the real estate brokerage Redfin, which surveyed 15 major metro housing markets.
Typically, the housing market starts to slow in late summer, and prices drop slightly. But so far that hasn’t been the case.
“Homes are not selling faster than last July, but faster than last year’s peak months,” says Javier Vivas, manager of economic research at realtor.com®. “However, quick sales don’t necessarily mean more sales, particularly when there isn’t enough inventory, as is the current case. Home prices also remain stubbornly high, failing to show hints of the usual seasonal cooldown. Low and moderately priced homes are being snatched up especially quickly, keeping many would-be buyers from being able to get into the market.”
Mortgage applications to purchase a home dropped three out of the past four weeks in July, according to the Mortgage Bankers Association. This may be another indicator of buyers' inability to seal deals.
“In this market, home buyers have to move fast, yet high prices and low inventory are slowing down even the most earnest of house hunters,” Nela Richardson, Redfin’s chief economist, told CNBC. “Faced with a low supply of homes for sale and extremely competitive conditions, many home buyers are struggling to make it to the offer stage.”
Source: “Housing Demand Strengthens Through Summer, But Here’s Why Some Buyers Are Giving Up,” CNBC (Aug. 2, 2017)
