HOUSING WATCH

Mortgage Rates Slide as Financial Markets Roil

The collapse of three regional banks and uncertainty in the financial markets pushed mortgage rates down to 6.42% as of March 23. Falling rates have helped curb the slide in home sales. While closings in Salt Lake County remain down compared to last year, they are falling at a slower pace. In February, there were 762 sales, down 24% compared to 1,003 sales in February 2022. In previous months, sales were down by as much as 49%.

“Mortgage rates continued to slide down as financial market concerns came to the fore over the last two weeks,” said Sam Khater, Freddie Mac’s Chief Economist. “However, on the homebuyer front, the news is more positive with improved purchase demand and stabilizing home prices. If mortgage rates continue to slide over the next few weeks, look for a continued rebound during the first weeks of the spring homebuying season.”

The inventory of homes for sale in Salt Lake County increased to 1,721 listings in February, up 113% compared to 808 listings a year ago. The months supply of inventory now stands at 1.7 months, up from 0.6 months a year earlier.

Higher mortgage rates increased the days on market until sale to 59 days in February, up from 18 days in February 2022.

The median sales price of homes (all housing types) sold in February fell to $494,650, down 4% compared to $515,000 in February 2022. The median single-family home price settled at $560,000, down 4% from $585,000 last year. Nationally, total existing-home sales year-over-year fell 23%, down from 5.92 million in February 2022, according to the National Association of Realtors®.

“Conscious of changing mortgage rates, home buyers are taking advantage of any rate declines,” said NAR Chief Economist Lawrence Yun. “Moreover, we’re seeing stronger sales gains in areas where home prices are decreasing and the local economies are adding jobs.”

First-time buyers were responsible for 27% of sales in February, down from 31% in January and 29% in February 2022.