A decline in home prices and mortgage rates has spurred a greater level of early-stage homebuying demand, according to new data published by the brokerage Redfin. However, rising demand is not translating into rising home sales.
Redfin’s Homebuyer Demand Index, a seasonally adjusted measure of requests for home tours and talking to the company’s agents about home searches or offers, reached its highest level since last May during the week ending March 26.
But Redfin acknowledged that demand does not mean an uptick in sales – pending sales fell 19% year-over-year in the four weeks ending March 26 while new listings of homes for sale dropped over the same period by 22%, one of the biggest plummets since the beginning of the pandemic three years ago.
Redfin reported the median U.S. home-sale price fell 1.8% year-over-year to $360,500, the sixth consecutive week of declines following more than a decade of nonstop price increases.
“Prices are still rising quickly in some places while they are down by double digits in big tech hubs, so it’s important for prospective buyers to work with an expert local agent,” said Redfin Deputy Chief Economist Taylor Marr. “One thing that’s true almost everywhere: It’s difficult to find a desirable, well-priced home for sale, so offer and negotiation strategies differ depending on where you’re looking.”