Mortgage rates are still twice what they were a year ago, but home prices have been falling since June, and that’s finally making consumers feel better about what had been an overheated, highly competitive housing market. We’ll be referencing this article from CNBC.
A monthly housing sentiment index from Fannie Mae showed sentiment improving from November to December. The index is still lower than it was a year ago and just slightly off its record low set in October and November.
More consumers now believe home prices will fall in the next 12 months, and more also said they believe mortgage rates will come down.
With the housing market now in its historically slow winter season, some agents are reporting activity is “frozen.”
Pending home sales, which represent signed contracts on existing homes, dropped more than expected in November, suggesting that closed sales in January will be lower as well.
Those sellers who are braving the housing chill are offering more concessions: Roughly 42% of sellers did so in the fourth quarter, the highest share in recent years, according to Redfin.
That’s up from just over 30% in both the previous quarter and the fourth quarter of 2021, and is higher than the previous high of 40.8%, notched during the three months ending July 2020, at the start of the Covid pandemic.