{"id":728343,"date":"2023-02-02T16:04:07","date_gmt":"2023-02-02T21:04:07","guid":{"rendered":"https:\/\/www.marketnewsdesk.com\/index.php\/redfin-reports-2500-monthly-budget-buys-a-400000-home-for-first-time-since-september-as-rates-dip-below-6\/"},"modified":"2023-02-02T16:04:07","modified_gmt":"2023-02-02T21:04:07","slug":"redfin-reports-2500-monthly-budget-buys-a-400000-home-for-first-time-since-september-as-rates-dip-below-6","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/redfin-reports-2500-monthly-budget-buys-a-400000-home-for-first-time-since-september-as-rates-dip-below-6\/","title":{"rendered":"Redfin Reports $2,500 Monthly Budget Buys a $400,000 Home For First Time Since September As Rates Dip Below 6%"},"content":{"rendered":"

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Redfin Reports $2,500 Monthly Budget Buys a $400,000 Home For First Time Since September As Rates Dip Below 6%<\/b><\/p>\n

Home sellers are starting to come off the sidelines to meet buyer demand as mortgage rates steadily decline, with new listings and pending sales both posting their smallest drops in four months<\/i><\/p>\n

SEATTLE–(BUSINESS WIRE<\/a>)–
\n(NASDAQ: RDFN) \u2014 A homebuyer on a $2,500 monthly budget can afford a $400,000 home for the first time in four months as mortgage rates dip below 6%, according to a new report<\/a> from Redfin (redfin.com<\/a>), the technology-powered real estate brokerage.\n<\/p>\n

\nThe average daily mortgage rate came in at 5.99% on February 2, the first sub-6% average since mid-September, according to Mortgage News Daily. To look at the change in affordability another way, a buyer with a $2,500 monthly budget can afford to spend about $35,000 more on a home than they could have when rates peaked at over 7% in November.\n<\/p>\n

\nA buyer on that budget still has about $95,000 less in spending power than they did a year ago, when rates were sitting around 3.5%. But rates dropping by more than a full percentage point from their apex is a relief for buyers who had been waiting for rates to come down.\n<\/p>\n

\nSome of those buyers are returning to the market. Pending home sales fell 23% from a year earlier during the four weeks ending January 29, the smallest decline since September and a notable improvement from the November trough, when pending sales declined 33% annually. Redfin\u2019s Homebuyer Demand Index\u2014a measure of requests for tours and other services from Redfin agents\u2014is up 19% from the October low. The market feels hotter, too, with 37% of newly listed homes accepting an offer within two weeks of hitting the market, the highest level since July.\n<\/p>\n

\nHome sellers are also starting to come off the sidelines. New listings of homes for sale declined 17% year over year\u2014a significant decline, but the smallest one in over four months and an improvement from the December trough, when new listings dropped 24% annually.\n<\/p>\n

\n\u201cWe expect more homebuyers and sellers to gradually return to the market by springtime, but mixed economic news and mixed reactions from the market mean the recovery will be uneven,\u201d said Redfin Economics Research Lead Chen Zhao. \u201cThe Fed’s interest-rate hike this week, for example, is both promising and disappointing. The Fed hiked rates at a slower pace than last year, which means mortgage rates are unlikely to rise further. But it also signaled ongoing rate increases to fight inflation, which will likely prevent the steep mortgage-rate decline that some optimistic buyers have been waiting for.\u201d\n<\/p>\n

\nMortgage-purchase applications rose 15% from their early-November trough but declined 10% from a week earlier, which could reflect the touch-and-go nature of the housing market recovery. It\u2019s worth noting that it\u2019s hard to draw a strong conclusion from this week\u2019s decline because the mortgage purchase application index has been volatile the past few weeks.\n<\/p>\n

Leading indicators of homebuying activity:<\/b><\/p>\n