B4 • Friday, August 19, 2022
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THE GARDEN ISLAND
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Julie Black, Principal Broker & Owner (808) 652-6174 with daughter Kela Caspillo, Realtor Sales Person (808) 652-6173 kauaidreams.com
HOME SALES FALL IN JULY Alex Veiga ASSOCIATED PRESS
LOS ANGELES — The housing market’s comedown from its high-flying days early this year is deepening, with home sales in July falling for the sixth straight month. Sharply higher mortgage rates, surging inflation and prices that remain near alltime highs are making homes less affordable. Sales fell 20.2% from July last year, reaching the slowest pace since May 2020, near the start of the pandemic. But the slowdown has begun to tip the homebuying equation, if ever so slightly, in favor of house hunters who can afford to stay in the market and away from sellers, who’d previously been able to offload their homes at prices they may have never dreamed of. Homes are still selling lightning fast, on average, and many continue to fetch multiple offers. But many sellers have had to become more flexible on their asking price and find they no longer can demand would-be buyers waive important safeguards like a home inspection before closing the deal. The shift doesn’t mean it’s a buyer’s market now — it’ll take a sharp increase in the number of homes on the market before that happens. Still, it is a notable reversal
Some see silver lining
house in Flower Mound, Texas, roughly 20 miles northwest of Dallas, on the market in early June for $575,000 and got several offers. They ended up accepting a $645,000 bid, but it fell apart soon after. The couple, which now live in Portland, Maine, relisted the house a few weeks later, but ended up accepting a $615,000 offer. “We started superoptimistic, we got a ton of offers over asking and then clearly a month later it was a couple of offers and much less,” said Brooks, a systems analyst. “We definitely thought if we left it on the market the offers would get lower and lower.” Even as the housing BRANDPOINT / CONTRIBUTED market is losing steam, home prices have continued to rise Sales of previously occupied U.S. homes slowed for the fifth consecutive month in sharply. The national median June 2022 as higher mortgage rates and rising prices kept many home hunters on home price jumped 10.8% in the sidelines. The National Association of Realtors said Wednesday, July 20, that July from a year earlier to existing home sales fell 5.4% last month from May to a seasonally adjusted annual $403,800. But earlier in the rate of 5.12 million. year, prices were climbing annually by around 20%. running at the slowest pace there yet.” after a housing shortage, Before the pandemic, the New data show somewhat since November 2015, NAR rock-bottom mortgage rates median home price was said. The last six-month of a mixed picture of the and soaring home prices rising about 5% a year, said losing streak happened housing market, with sales skewed the housing market Lawrence Yun, NAR’s chief between August 2013 and continuing to decline while strongly in sellers’ favor in economist. January 2014. the tight inventory of recent years. “So, it’s still rising quite Despite the softer market, “We know that homes are properties for sale keep strongly, even though it is many sellers are still prices climbing. taking longer to sell, sellers entertaining several offers. A moderating from a superThe National Association are having to price more heated pace,” he said. typical home received 2.8 of Realtors said Thursday carefully and are having to At the start of the year, that existing home sales fell offers last month, though adjust if they’re not priced competitively,” said Danielle 5.9% last month from June to that’s down from 4.5 offers a when the real estate market was still red hot, competition a seasonally adjusted annual year earlier, NAR said. Hale, chief economist for fueled bidding wars that Nicholas Brooks and Realtor.com. “So, it’s moving rate of 4.81 million. often resulted in homes Nathan Giddings put their in a buyer-friendly direction, Excluding the pandemic selling within days of going slowdown, sales in July were four-bedroom, 2.5-bath but I’m not sure it’s quite
Average mortgage rates retreat slightly this week ASSOCIATED PRESS WASHINGTON — Average longterm U.S. mortgage rates came back down slightly this week after the key 30-year loan rate jumped nearly a quarter point last week. Mortgage buyer Freddie Mac reported Thursday that the 30-year rate fell to 5.13% from 5.22% last week. Last year at this time, the rate stood at 2.86%. The average rate on 15-year, fixed-rate mortgages, popular among those looking to refinance their homes, inched down to 4.55% from 4.59% last week. One year ago, it was 2.16%. Rapidly rising interest rates — which add hundreds of dollars to monthly mortgage payments — have pushed many potential homebuyers to the sideline this year, cooling the once red-hot housing market. The National Association of Realtors said Thursday that existing home sales fell for the sixth consecutive month in July, slowed by higher mortgage rates and home prices that are still steadily rising, though at a slower pace. The national median home price jumped 10.8% in July from a year earlier to $403,800. A few months ago, the year-over-year price increase for an existing home was around 15%. Sales of previously occupied homes fell 5.9% from June and are off more than 20% from a year ago. The Federal Reserve has increased its main borrowing rate four times this year in an effort to curb four-decade high inflation. Mortgage rates don’t necessarily mirror the Fed’s rate increases.
on sale and for well above their listing price. As the market has cooled, however, the difference between the price homes are listed for and what they end up fetching has narrowed nationally. In January, the median U.S. home sale price was 14.4% below the median listing price, but by May the difference increased to 19.5%, according to an analysis by Realtor.com. Even in a red-hot market, on a national basis, homes typically sell at below asking price. Data suggest some metropolitan areas where homes on average were selling above the asking price have reversed entirely and are no longer sellers’ markets as buyers have regained more leverage to negotiate a more favorable price. For example, in the Memphis metropolitan area the median home sale price in January was 11.1% higher than the median listing price. That flipped by May, with the median sale price ending up 11.4% lower than the median listing price, according to Realtor.com. The trend isn’t confined to one particular region. Among those locations less favorable for sellers are metro areas around Honolulu, Miami, Detroit, Milwaukee and Little Rock, Arkansas.