{"id":802023,"date":"2025-01-17T08:03:37","date_gmt":"2025-01-17T13:03:37","guid":{"rendered":"https:\/\/www.marketnewsdesk.com\/index.php\/pending-home-sales-fell-the-most-since-2022-in-december-as-mortgage-rates-jumped\/"},"modified":"2025-01-17T08:03:37","modified_gmt":"2025-01-17T13:03:37","slug":"pending-home-sales-fell-the-most-since-2022-in-december-as-mortgage-rates-jumped","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/pending-home-sales-fell-the-most-since-2022-in-december-as-mortgage-rates-jumped\/","title":{"rendered":"Pending Home Sales Fell the Most Since 2022 in December as Mortgage Rates Jumped"},"content":{"rendered":"

<\/p>\n

Pending Home Sales Fell the Most Since 2022 in December as Mortgage Rates Jumped<\/b><\/p>\n

Redfin reports roughly 40,000 home purchases were called off in December, equal to 16% of homes that went under contract\u2014the highest December percentage on record<\/i><\/p>\n

SEATTLE–(BUSINESS WIRE<\/a>)–
\n(NASDAQ: RDFN) \u2014 Pending home sales fell 4.5% month over month in December on a seasonally adjusted basis\u2014the largest decline since October 2022\u2014and dropped 2.3% year over year. That is according to a new report<\/a> from Redfin (redfin.com<\/a>), the technology-powered real estate brokerage.<\/p>\n

\nHomebuyer demand dipped at the end of the year because mortgage rates jumped. After inching downward at the beginning of the month, mortgage rates reversed course halfway through December and have been rising since\u2014in part because the Federal Reserve projected<\/a> fewer 2025 interest-rate cuts than anticipated. The weekly average 30-year-fixed mortgage rate now sits at 7.04%, the highest level since May, after hitting an early-December low of 6.6%.<\/p>\n

\nHome purchases fell through at the highest December rate on record, which likely contributed to the decline in pending sales. Nearly 40,000 home-purchase agreements were canceled in December, equal to 16.2% of homes that went under contract that month. That\u2019s the highest December percentage in records dating back to 2017 and is up from 15.1% a year earlier.<\/p>\n

\n\u201cHomebuying activity will likely slow further in January due to the wildfires impacting Los Angeles\u2014the nation\u2019s second most populous metro area\u2014and winter storms impacting the Mid-Atlantic and Southeast,\u201d said Redfin Senior Economist Elijah de la Campa. \u201cRent prices, on the other hand, may tick up as people who have been displaced by the fires seek alternative housing.\u201d<\/p>\n

Existing Home Sales Rose to the Highest Level in Nearly Two Years<\/b><\/p>\n

\nExisting home sales rose 0.7% month over month in December to a seasonally adjusted annual rate of 4,317,683\u2014the highest level since February 2023. They jumped 6% year over year\u2014the largest annual increase since July 2021.<\/p>\n

\nA seasonally adjusted annual rate is not a measurement of actual total sales for the year, but rather, the pace of sales at a given time. A seasonally adjusted annual rate of 4,317,683 in December means that existing home sales would end the year at that level if homes were sold at the December pace for each month of 2024. For the full year of 2024, actual existing home sales came in at 4,189,268\u2014roughly in line with 2023.<\/p>\n

\nOverall home sales, a metric that includes sales of both existing and newly built homes, rose 1.9% month over month on a seasonally adjusted basis. They jumped 9.3% year over year, the biggest annual gain since June 2021.<\/p>\n

\nIt\u2019s worth noting that both existing and overall home sales are lagging indicators. They reflect purchases that, while finalized in December, went under contract during the several months leading up to December. Those several months were a key time in the housing market; housing demand jumped<\/a> in September as mortgage rates hit a two-year low and the Federal Reserve cut interest rates, and then jumped again<\/a> after the uncertainty around the election disappeared.<\/p>\n

\n\u201cHomebuyers pumped the brakes when mortgage rates ticked back up and are now in wait-and-see mode,\u201d said Jesse Landin<\/a>, a Redfin Premier<\/a> real estate agent in San Antonio. \u201cEveryone is just trying to figure out when rates are going to come down again. In the meantime, a lot of house hunters are opting to rent.\u201d<\/p>\n

\nRedfin expects mortgage rates to remain elevated and volatile throughout 2025.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
\n

December 2024 Housing Market Highlights: United States<\/b><\/p>\n<\/td>\n<\/tr>\n

\n

\n\u00a0<\/p>\n<\/td>\n<\/tr>\n

\n

\n\u00a0<\/p>\n<\/td>\n

\n

December 2024<\/b><\/p>\n<\/td>\n

\n

Month-over-month change<\/b><\/p>\n<\/td>\n

\n

Year-over-year change<\/b><\/p>\n<\/td>\n<\/tr>\n

\n

Median sale price<\/b><\/p>\n<\/td>\n

\n

\n$427,670<\/p>\n<\/td>\n

\n

\n-0.5%<\/p>\n<\/td>\n

\n

\n6.3%<\/p>\n<\/td>\n<\/tr>\n

\n

Existing home sales, seasonally adjusted annual rate<\/b><\/p>\n<\/td>\n

\n

\n4,317,683<\/p>\n<\/td>\n

\n

\n0.7%<\/p>\n<\/td>\n

\n

\n6%<\/p>\n<\/td>\n<\/tr>\n

\n

Pending home sales, seasonally adjusted<\/b><\/p>\n<\/td>\n

\n

\n471,888<\/p>\n<\/td>\n

\n

\n-4.5%<\/p>\n<\/td>\n

\n

\n-2.3%<\/p>\n<\/td>\n<\/tr>\n

\n

Homes sold, seasonally adjusted<\/b><\/p>\n<\/td>\n

\n

\n449,684<\/p>\n<\/td>\n

\n

\n1.9%<\/p>\n<\/td>\n

\n

\n9.3%<\/p>\n<\/td>\n<\/tr>\n

\n

New listings, seasonally adjusted<\/b><\/p>\n<\/td>\n

\n

\n515,054<\/p>\n<\/td>\n

\n

\n-1.6%<\/p>\n<\/td>\n

\n

\n-1.5%<\/p>\n<\/td>\n<\/tr>\n

\n

Total homes for sale, seasonally adjusted (active listings)<\/b><\/p>\n<\/td>\n

\n

\n1,723,121<\/p>\n<\/td>\n

\n

\n-0.3%<\/p>\n<\/td>\n

\n

\n7%<\/p>\n<\/td>\n<\/tr>\n

\n

Months of supply<\/b><\/p>\n<\/td>\n

\n

\n2.5<\/p>\n<\/td>\n

\n

\n-0.6<\/p>\n<\/td>\n

\n

\n-0.1<\/p>\n<\/td>\n<\/tr>\n

\n

Median days on market<\/b><\/p>\n<\/td>\n

\n

\n49<\/p>\n<\/td>\n

\n

\n6<\/p>\n<\/td>\n

\n

\n6<\/p>\n<\/td>\n<\/tr>\n

\n

Share of homes sold above final list price<\/b><\/p>\n<\/td>\n

\n

\n24.2%<\/p>\n<\/td>\n

\n

\n-2.4 ppts<\/p>\n<\/td>\n

\n

\n-1.4 ppts<\/p>\n<\/td>\n<\/tr>\n

\n

Average sale-to-final-list-price ratio<\/b><\/p>\n<\/td>\n

\n

\n98.5%<\/p>\n<\/td>\n

\n

\n-0.3 ppts<\/p>\n<\/td>\n

\n

\n-0.1 ppts<\/p>\n<\/td>\n<\/tr>\n

\n

Pending sales that fell out of contract, as % of overall pending sales<\/b><\/p>\n<\/td>\n

\n

\n16.2%<\/p>\n<\/td>\n

\n

\n1.5 ppts<\/p>\n<\/td>\n

\n

\n1.1 ppts<\/p>\n<\/td>\n<\/tr>\n

\n

Monthly average 30-year fixed mortgage rate<\/b><\/a><\/p>\n<\/td>\n

\n

\n6.72%<\/p>\n<\/td>\n

\n

\n-0.09 ppts<\/p>\n<\/td>\n

\n

\n-0.1 ppts<\/p>\n<\/td>\n<\/tr>\n<\/table>\n

Home Prices Posted the Largest Gain in Almost a Year<\/b><\/p>\n

\nThe median U.S. home sale price increased 6.3% year over year to $427,670 in December, the biggest annual gain since February.<\/p>\n

\nPrices continue climbing because there\u2019s still a shortage of homes for sale. New listings fell 1.6% month over month on a seasonally adjusted basis and declined 1.5% year over year.<\/p>\n

\nActive listings, a measure of all homes on the market, fell 0.3% month over month\u2014the first decline on a seasonally adjusted basis in five months. They rose 7% year over year, but that was the smallest annual increase in nearly a year. One reason active listings are rising is that some homes are taking a long time to sell, causing stale supply to pile up.<\/p>\n

Homes Sold at the Slowest December Pace in Five Years<\/b><\/p>\n

\nThe typical home that went under contract in December was on the market for 49 days\u2014the slowest December pace since 2019. That\u2019s up from 43 days a year earlier.<\/p>\n

\nJust 25.1% of homes went under contract within two weeks\u2014the lowest share in five years. That\u2019s down from 28.4% in December 2023.<\/p>\n

\nOne silver lining in a slow housing market: Buyers have more flexibility to bide their time and ask sellers for concessions.<\/p>\n

Metro-Level Highlights: December 2024<\/b><\/p>\n