Homebuyer competition saw its second consecutive monthly decline in April as surging mortgage rates prompt a growing number of buyers to drop out of bidding wars in some of the nation’s most popular housing markets. Roughly 61% of home offers written by Redfin agents encountered competition on a seasonally adjusted basis in April, down from a revised rate of 63.4% in March and 67.4% a year earlier, Redfin reports.
The average 30-year fixed mortgage rate is up to 5.3%, sending the typical monthly mortgage payment for homebuyers up a staggering 44% year-over-year to a record high of $2,427. As market experts anticipate even more gains in the months ahead, many buyers are choosing not to stick around.
“The meteoric rise in mortgage rates is prompting more house hunters to back out of the market, causing competition to cool,” said Redfin Chief Economist Daryl Fairweather. “Higher rates are also limiting homebuyers’ ability to significantly bid up home prices, meaning some homes aren’t selling for as much over the asking price as they would have a year ago. This could help set off a slowdown in home-price growth in the coming months.”
Advertisement
Related Stories
Sales
What the NAR Commissions Settlement Means for Home Builders
The legal settlement will improve transparency during the home sales process, mitigate predatory practices, and help preserve profitability for home builders
New-Home Sales
Mortgage Rates Are Up but New-Home Sales Still Solid in March
Lack of existing home inventory drove a rise in new-home sales, despite higher interest rates in March
Sustainability
Mention of Eco-Friendly Home Features Is on the Rise in Sales Listings
Home listing descriptions using eco-friendly terms have been rising over the past five years in line with growing consumer interest in the environment and energy efficiency
