Home prices hit a record high of $363,975 as the market continued to heat up in the four-week period ending February 27, according to a new report from Redfin.
The median home sale price rose 16% year-over-year, the biggest annual increase since August. The typical home sold for 0.8% above list price, the biggest premium since October. Intense competition among buyers, driven by a severe shortage of homes for sale, is driving prices up at an unusual rate.
“The war in Ukraine has shaken the global economy, causing mortgage rates to plummet after weeks of increases,” said Redfin deputy chief economist Taylor Marr. “Lower mortgage rates should temporarily boost demand for home purchases, fueling the continued rise in prices. But demand could fall if the Federal Reserve raises interest rates again as expected.
Housing Market Highlights for 400+ U.S. Metro Areas:
- The median asking price for newly listed homes rose 15% year-over-year to an all-time high of $390,488, and was up 27% from the same period in 2020.
- The monthly mortgage payment on the median asking price fell slightly to $2,018 at the current mortgage rate of 3.76%. This is an increase of 23% from the previous year, when mortgage rates were 3.02%, and 36% from the same period in 2020.
- Pending home sales were up 2.6% year-over-year and 31% from the same period in 2020, just before the pandemic began.
- New home listings for sale were down 1% from the previous year. Compared to 2020, new listings are down 10%.
- Active listings fell 24% year-over-year, falling to an all-time low of 456,000. Listings were down 50% from the same period in 2020.
- 58% of houses under contract had an offer accepted within the first two weeks on the market, an all-time high. This rate was up from 51% the previous year and 43% in 2020.
- 45% of homes under contract had an offer accepted within a week of being put on the market, an all-time high. This figure was up from 39% in the same period a year earlier and 30% in 2020.
- Homes sold were on the market for a median of 26 days, down from 35 days a year earlier and 56 days in 2020.
- 44% of homes sold above list price, compared to 35% a year earlier and 21% in 2020.
- On average, 2.6% of homes for sale each week saw a price drop, up 0.5 percentage points from the same period in 2021, but down 0.6 percentage points from to 2020.
- The average sale price to listing price ratio, which measures how well homes are selling relative to their asking price, rose to 100.8%. In other words, the average home sold for 0.8% above its asking price. This figure was up from 99.5% in 2021 and 97.9% in 2020.
Other leading indicators of home buying activity include the 2% drop in mortgage purchase applications week-over-week in the week ending Feb. 25. For the week ending March 3, 30-year mortgage rates fell to 3.76% from 3.89% the previous week. Overall, the Redfin Homebuyer Demand Index fell 0.4% from the previous week in the seven-day period ending February 27 and was up 13% from the previous week. to the previous year.
To view the full report, including charts and methodology, click here.