Redfin, the Seattle-based, technology powered real estate company, reported today (5-18-22) that, nationwide, 60.7% of home offers written by Redfin agents in April encountered competition on seasonally annual adjusted basis. This is the lowest level seen since March of 2021. The statistic is down from a revised rate of 63.4% in March of 2022 and 67.4% in April of 2021. The decline marks the second consecutive monthly decline.
Redfin notes that the housing market has softened in recent weeks because mortgage rates have surged to their highest level in more than a decade as the government tries to quell inflation. The average 30-year fixed mortgage rate is now 5.3%, up from 3.76% at the start of March and a record low of 2.65% in January 2021. The rise in rates and home prices has sent the typical monthly mortgage payment for homebuyers up a record 44% year-over-year to an all-time high of $2,427.
In a statement prepared for the release of the report, Redfin’s Chief Economist Daryl Fairweather said, “The meteoric rise in mortgage rates is prompting more house hunters to back out of the market, causing competition to cool. 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.”
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Homebuyer Competition Falls for Second-Straight Month, Hitting Lowest Level in Over a Year