B4 • Friday, September 23, 2022
THE GARDEN ISLAND
thegardenisland.com
AUGUST SALES SLIP, PRICES GREW SLOWLY the number of homes that are available for sale. “That lock-in effect is continuing to impact invenSales of previously occupied U.S. homes slowed in tory and I think it will conAugust for the seventh tinue to impact inventory month in a row, as sharply going forward,” Yun said. higher mortgage rates and Some 85% of U.S. homerising prices made homeowners with a mortgage now have a rate well below buying less affordable, fur6%, according to Redfin. ther cooling the once The disparity gives less inred-hot housing market. The National Association centive to these homeownof Realtors said Wednesday ers to sell and buy another that existing home sales fell home, because taking on a 0.4% last month from July higher mortgage rate would to a seasonally adjusted anmean paying more over the life of the loan and also as nual rate of 4.80 million. bigger monthly payment. That’s higher than what In the four weeks ended economists were expecting, Sept. 11, home listings fell according to FactSet. 19% from a year earlier, the Sales fell 19.9% from Aulargest drop since May gust last year, and are now 2020, the real estate brokerat the slowest annual pace since May 2020, near the age found. start of the pandemic. Some 1.28 million homes The national median were on the market at the home price jumped 7.7% in end of August, down 1.5% August from a year earlier from July and flat versus to $389,500. August last year, NAR said. As the housing market On average, homes sold has cooled, home prices in just 16 days of hitting the STEVEN SENNE / ASSOCIATED PRESS FILE market last month, up from have been rising at a more moderate pace after surg14 days in July. A for sale sign stands in front of a house on Oct. 6, 2020, in Westwood, Mass. Before the pandemic, ing annually by around 20% homes typically sold more averaged 2.86%. on a typical home from rising again along with the earlier this year. Before the neck pace in recent years than 30 days after being The last time the long$897 to $1,643 a month, an 10-year Treasury yield, pandemic, the median as homebuyers grapple term average rate has been which influences home loan 83% increase over the past listed for sale. home price was rising with the highest mortgage At the current sales pace, this high was November three years, according to an rates. about 5% a year. rates in more than a de2008, just after the housing The 10-year yield traded analysis by real estate infor- the level of for-sale proper“The rising mortgage rate cade, as well as inflation market collapse triggered at its highest levels since has clearly hampered the that is hovering near a mation company Zillow. ties amounts to a 3.2-month the Great Recession. 2011 on Tuesday, reflecting housing market,” said Law- four-decade high. Surging home loan rates supply, Yun said. That’s unMortgage rates eased in expectations of further inThe average rate on a 30don’t just make homes less changed from July and rence Yun, NAR’s chief July after climbing in June, terest rate hikes by the Fed- affordable, they also disyear home loan rose to economist. higher than the 2.6-month which may have helped mo- eral Reserve in its bid to 6.02% last week, moving The August sales report supply in August last year. couraging homeowners above 6% for the first time is the latest evidence that In a more balanced market squash inflation. who locked in an ultra-low tivate homebuyers last since 2008, according to the housing market, a key Higher home prices and rate the last couple of years between buyers and sellers month, limiting the sales driver of economic growth, mortgage buyer Freddie there is a 5- to 6-month supmortgage rates have from buying a new home. decline. More recently, Mac. A year earlier, the rate however, rates have been is slowing from its breakpushed mortgage payments That, in turn, can limit ply. Alex Veiga ASSOCIATED PRESS
Average US long-term mortgage rates climb to 6.29% this week ASSOCIATED PRESS WASHINGTON — Average longterm U.S. mortgage rates jumped by more than a quarter-point this week to their highest level since 2008 as the Federal Reserve intensified its effort to tamp down decades-high inflation and cool the economy. Mortgage buyer Freddie Mac reported Thursday that the 30-year rate climbed to 6.29%, from 6.02% last week. That’s the highest its been since October of 2008 when the housing market crashed, triggering the Great Recession. Rapidly rising mortgage rates threaten to sideline even more homebuyers after more than doubling in 2022. Last year, prospective homebuyers were looking at rates well below 3%. On Wednesday, the Federal Reserve bumped its benchmark borrowing rate by another three-quarters of a point in an effort to constrain the economy, its fifth increase this year and third consecutive 0.75 percentage point increase. Perhaps nowhere else is the effect of the Fed’s action more apparent than the housing sector. Existing home sales have been in decline for seven straight months as the rising cost to borrow money puts homes out of reach for more people. The National Association of Realtors said Wednesday that existing home sales fell 0.4% last month from July to a seasonally adjusted annual rate of 4.80 million. Sales fell 19.9% from August last year, and are now at the slowest annual pace since May 2020, early in the pandemic.