US Home Sale Prices Dip Below Year-Ago Levels for Two Straight Weeks
U.S. home prices have fallen below year-ago levels for the first time in more than three years. The median U.S. home-sale price was $389,601 for the four weeks ending October 25, down 0.1 percent from a year earlier. But the burden on homebuying households has not eased. The monthly payment is 10.7 percent higher than a year ago.
The key is mortgage rates. The average 30-year fixed mortgage rate rose from 6.17 percent a year ago to 7.24 percent in the week ending October 29. While home prices fell 0.1 percent, rates rose more than a percentage point. That pushed the median monthly payment to $2,786. The price decline has not kept up with the rate increase.
The sequence ran like this. When rates reached a three-year high in early October, a weekly average of 7.4 percent, buyers pulled back and sellers started cutting prices. Asking prices fell first. The median asking price was $396,881 for the four weeks ending October 11, down 0.3 percent from a year earlier. Two weeks later, completed sale prices followed. The asking price is the price a seller first lists. The sale price is what a buyer actually pays.
The market has stalled. Pending sales are at their lowest since Redfin’s records began in 2021, falling in all 50 of the largest metro areas for a third straight week. The share of listings with a price cut reached 22 percent, the highest on record. Unsold homes piled up, bringing supply to 4.5 months. Four to five months is considered a balanced level of supply and demand.
A Cooler Philadelphia Market
In the Philadelphia metro area, prices held while transactions stalled. Bright MLS reported the September median sold price was $400,000, up 2.6 percent from a year earlier. But new pending sales fell 10.7 percent to 5,159. Active listings rose 19.6 percent.
The drop in transactions was larger in the city and Delaware County alone. The Philadelphia Business Journal, citing Bright MLS data, reported the city of Philadelphia recorded 1,001 closings in September, down 10 percent, while Delaware County recorded 389, down 16 percent. The median sale price for the two counties combined was $279,358, nearly unchanged, while nearby suburbs reached $508,832, up 5.2 percent.
Quarterly statistics still look higher because of a time lag. Third-quarter figures include deals signed before rates surged. Looking at only the most recent four weeks, the direction is different.
Rates will decide what happens next. The next Freddie Mac weekly survey comes out Thursday, and the employment report arrives Friday morning.
