\nRedfin expects existing-home sales to end 2025 roughly in line with 2024, which was the slowest year since 1995\u2014but the outlook could improve if rates fall further<\/i><\/p>
SEATTLE--(BUSINESS WIRE)--Active listings of homes for sale fell 1.4% month over month in August\u2014the largest seasonally-adjusted decline since June 2023, according to a new r<\/a>epo<\/a>r<\/a>t<\/a> from Redfin<\/a>, the real estate brokerage powered by Rocket. They rose 9.7% from a year earlier\u2014the smallest year-over-year increase since March 2024.<\/p> \nNew listings also cooled, falling 1.1% month over month to the lowest seasonally-adjusted level since January 2024 and declining 2.6% year over year.<\/p> \nSellers have been pulling back because homebuyer demand is sluggish, with sales still far below pre-pandemic levels. Pending home sales and existing home sales were both little changed in August, with pending sales falling 0.4% from a month earlier on a seasonally adjusted basis and existing home sales rising 0.2% to a seasonally adjusted annual rate of 4,227,589.<\/p> \n\u201cHigh housing costs and economic jitters have rattled buyers, and that unease has spilled over to sellers. We currently expect existing-home sales to end the year at around 4.05 million, or roughly flat compared to 2024, which was the worst year for sales since 1995,\u201d said Chen Zhao<\/a>, Redfin's head of economics research. \u201cThe good news is mortgage rates have been falling, giving homebuyers more purchasing power.<\/a> We have yet to see that translate into a significant bump in sales, but that may change if rates continue declining; if we get a stronger-than-expected fall housing market, existing-home sales could end this year a little higher than last year.\u201d<\/p> \nThe average 30-year-fixed mortgage rate fell to 6.59% in August\u2014the lowest monthly average in 10 months. Rates have since fallen further, last week dropping to 6.26%\u2014the lowest level in roughly a year. That has triggered a rise in refinancing activity among existing homeowners, but many prospective homebuyers are still waiting in hopes that rates fall further. The Federal Reserve cut its benchmark interest rate last week, but that was already priced into mortgage rates. Redfin economists expect<\/a> mortgage rates to remain steady in the near term as market participants await further economic data, particularly the next jobs report on October 3.<\/p> \n\u201cI think the magic number is 6%,\u201d said Beth Behling<\/a>, a Redfin Premier<\/a> real estate agent in Chicago. \u201cProspective homebuyers are paying attention to mortgage rates, and if they drop to 6%, I think we\u2019ll see a flood of interest.\u201d<\/p>