US Existing-Home Median Mortgage Payments Drop Year-Over-Year in February

On Thursday, Redfin reported that the median US monthly housing payment was $2,591 during the four weeks ending March 1, down 2.8% year-over-year.

Redfin said declining mortgage rates were the main driver. The weekly average mortgage rate fell to 5.98% last week, down from 6.76% a year earlier and the first time it has dipped below 6.0% in three and a half years. The daily average mortgage rate moved slightly higher afterward, rising from 5.99% last week to 6.07% on March 4.

Home prices continued to edge higher despite softer demand. The median home-sale price increased 1% year-over-year to $381,750.

Redfin said prices are rising partly because housing supply is tightening even as homebuying activity slows. Pending home sales declined 2.8% year-over-year. New listings fell 1.2%, while the total number of homes for sale dropped 1.9%, the largest decline in more than two years.

Commenting on the report, Redfin Head of Economic Research Chen Zhao said:

“Last week, Americans were hit with headlines about mortgage rates dropping below 6%, which provided some hope. But over the weekend, those headlines were replaced with ones about the war in the Middle East. The war could make some would-be buyers think twice, in the same way economic and global uncertainty have been turning off buyers for the last year, and it’s likely to cause short-term volatility in mortgage rates. But the war’s impact on the economy will mostly be felt in oil markets, which are unlikely to have a big impact on mortgage rates or demand unless the conflict goes on much longer than expected.”