Home prices are dropping for the first time in years in certain U.S. metros, including Austin (down 2.9% year over year), San Antonio (down 1.2%), Fort Worth (down 1.2%) and Portland, Ore. (down 0.9%), according to a report from Redfin.
Nationwide, price drops are at their highest level since November 2022, suggesting more metros may soon see sale prices decline, according to the firm’s data.
Nationwide, home prices increased 4.4% from a year earlier to an all-time high during the four weeks ended June 2.
But there are early indicators that national price growth could soften soon: 6.4% of U.S. home sellers cut their asking price, on average, the highest share since November 2022.
And the typical active listing has been on the market for 46 days, up 2.3% year over year–the biggest increase in nine months, suggesting home listings are growing stale faster than they were a year ago.
Some listings are growing stale because high mortgage rates and housing costs are causing would-be buyers to back off.
The weekly average mortgage rate rose back above 7% last week, pushing the median U.S. monthly housing payment to a near-record-high of $2,838.
Pending home sales fell 3.8% year over year, the biggest decline in three months, and mortgage-purchase applications declined 4% week over week.
Inventory is losing momentum, too, which is another reason sales are falling. New listings posted one of their smallest year-over-year increases (6.9%) since February, with high mortgage rates discouraging homeowners from selling because it would mean giving up their low rate and trying to offload their home in a relatively slow market.
“There’s no getting around the fact that it’s expensive to buy a home right now, but some people are having luck negotiating with sellers,” says Bonnie Phillips, a Redfin Premier agent in Cleveland. “I’ve seen buyers get a home under asking price when it has been on the market for a few weeks. That’s especially true when their agent presents market data that supports a lower market value, like comps of similar homes nearby that have sold for less, or fewer than usual online views or tours. Other buyers are finding creative ways to afford a home, like buying a duplex, living in one unit and renting out the other.”
Photo: Dillon Kydd
