\nMortgage rates jumped to a 10-month high, spooking would-be homebuyers and sellers after<\/i>\u00a0a few weeks of solid demand<\/i><\/p>
SEATTLE--(BUSINESS WIRE)--U.S. pending home sales fell 1.1% from a week earlier during the week ending May 17, the first decline since early April, according to a new report<\/a> from Redfin<\/a>, the real estate brokerage powered by Rocket.<\/p> \nPending sales are still at their second-highest level since September 2022, but it\u2019s notable that the jump seen over the last several weeks is starting to reverse. Note that this data is seasonally adjusted.<\/p> \nAdditionally, mortgage-purchase applications declined 4% week over week. Homebuying demand fell because mortgage rates increased. The daily average mortgage rate hit 6.75% this week, the highest level since July. Prices are rising, too; the median asking price increased 1.4% year over year.<\/p> \nPending home sales rose each week from early April to early May because of a strengthening job market<\/a> and declining mortgage rates; the daily average rate dipped to the 6.3% range in mid-April. Now, rates have jumped due to the Iran war and the continued closure of the Strait of Hormuz spooking<\/a> global markets.<\/p> \nOn the selling side, new listings declined 0.2% week over week on a seasonally adjusted basis. That marks the third straight week of new listings declining.<\/p> \n\u201cHigher mortgage rates are scaring off some buyers, but that\u2019s opening the door for others,\u201d said Chen Zhao<\/a>, Redfin\u2019s head of economics research. \u201cIt\u2019s already a buyer\u2019s market<\/a>, and this week\u2019s jump in mortgage rates may give house hunters with stable incomes another opportunity to negotiate a home\u2019s price down and get concessions from sellers.\u201d<\/p> \nDuring a time of changing demand, sellers may consider a \u201ccoming soon\u201d approach like Redfin Early Access<\/a>, which allows them to test pricing strategies and gauge interest before formally listing on the MLS.<\/p> \nFor Redfin economists\u2019 takes on the housing market, please visit Redfin\u2019s \u201cFrom Our Economists<\/a>\u201d page.<\/p> \nLeading indicators<\/b><\/p>