The estimated monthly mortgage payment for the average home for sale in the U.S. rose 25% year-over-year to a record high of $1,931 during the week ending February 6, Redfin reports. After solid consecutive month-over-month gains, the median asking price for a single-family home now rests around $376,000, and the average 30-year mortgage rate is also up to 3.69%.
Home sales are down slightly year-over-year, but still strong despite a 29% drop in inventory from a year earlier and a 50% decline since early 2020. As prices jump to new highs and a constricted supply leads to heightened competition, the market’s pace is quickly accelerating. Homes are selling at a record pace as movers feel the pressure of increasing costs and a worsening housing shortage. Rather than waiting for conditions to potentially improve, more buyers are opting to jump into the fray just two months into a heated 2022 market.
Over half (55%) of homes that found a buyer spent two weeks or less on the market—the highest rate on record for this time of year.
“Movers are feeling a big pinch. There is nowhere for them to run from increasing housing costs now that mortgage rates are rising and inflation has spread to the rental market,” said Redfin Chief Economist Daryl Fairweather. “Homebuyers feel uneasy making offers on homes with such high asking prices, but there is no better alternative. Would-be homebuyers who bowed out last year are kicking themselves, but delaying purchasing a home another year could be a costly mistake.