Mortgage applications rise as home supply sees record increases

by Liz Hughes

Heading into Thanksgiving, mortgage applications increased as rates stayed around 6.6%, a drop from 7% at the start of the month, saving homebuyers more than $100 in monthly payments, according to a new Redfin report

That wasn’t the only good news as the end of the month neared. During the four weeks ended Nov. 20, Redfin’s Homebuyer Demand index, which measures requests for tours and other services, also increased — up 1.6% from September but down 33% from 2021. Also, home supply is growing at a record annual increase while pending home sales dropped, giving today’s potential homebuyers loads of options. 

Mortgage rates fell to 6.58% in the week ending Nov. 23 while mortgage applications rose 8.7% despite purchase applications being down 41% from 2021. That brings the average monthly mortgage payment on a median price home to $2,384, down slightly from the previous week and down 6% from two weeks prior when mortgage rates were 7.08%. The drop means $140 in savings for homebuyers. 

During the previous week, pending home sales fell 35.2% from last year, marking the largest decline since January 2015.

Redfin found fewer Google searches for “homes for sale” during the week ended Nov. 19, down 38% from last year. Its Homebuyer Demand Index was up 1.6% from October but down 33% from 2021 during the four weeks ended Nov. 20.

In the four weeks ended Nov. 20, active listings rose 11.6% from last year. Meanwhile, new listings fell 20% from last year, one of the largest declines since the start of the pandemic. 

The median asking price rose 4.6% from 2021 to $363,600, the smallest annual growth since the pandemic began. Meanwhile, the median sale price increased 2.1% year over year to $356,149, marking the smallest increase since the start of the pandemic, according to the report.

​​Thirty-two percent of homes that went under contract had an offer within the first two weeks, showing little change from the previous four weeks but down from 40% last year. Twenty-seven percent of homes sold above list price, down from 42% last year and the lowest percentage since July 2020.

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