U.S. Homes are Selling for 1% Less than Last Year’s All-Time Record High

Redfin, the Seattle-based, technology powered, real estate brokerage firm reported on Thursday (6-29-23), that according to their data the typical U.S. home is selling for approximately $383,000, only about $4,000 (1%), that the all-time high set in June 2022. That is, Redfin says, the smallest year-over-year drop in nearly four months. In addition, this is just the second time since last August the sale-to-list price ratio has hit 100%; in other words, the average home is now selling for its asking price.

Redfin points to a lack of homes for sale as the reason home prices remain afloat. New listing dropped 27% from a year earlier during the four-week period ending June 25, the largest drop since the start of the pandemic. That has contributed to the total number of homes for sale declining 11%, the first double-digit drop in over a year.

Redfin also notes that inventory is falling because of high mortgage rates, with many homeowners staying in their current residence wanting to take advantage of the comparatively lower mortgage rates on their homes. With interest rates on a 30-year mortgage inching lower in recent weeks; they are still near 7% , which is more than double 2021’s record-low levels.

Finally, Redfin says that higher interest rates are also deterring homebuyers, but they still outnumber home sellers. Pending home sales are down 15%, significantly smaller than the drop in new listings. That means buyers are snapping up inventory faster than is being listed, which in turn is keeping home prices elevated.