Asking prices for homes reached an all-time high in September, despite pending sales and new listings cooling.
Redfin chief economist Daryl Fairweather said the increase in asking prices shows home sellers’ optimism about the market, but there are still signs that mortgage rates are starting to rise.
“The hit to affordability that comes with higher rates and higher home prices could let some steam out of the market,” he said in a press release. “It’s never a good idea to overprice your home, but I would be especially wary of overpricing, as seasonal cooling trends persist and rising rates take some affordability out of the homebuying equation.”
Despite the increase in asking prices, pending sales were up 4% from a year earlier, the lowest increase since June 2020, a sign of typical seasonal cooling, according to the report, which also noted new listings were down 20% from their 2021 peak.
For the four weeks ended Sept. 26, new listings were down 78% from the previous year, as they continued to be below the 2020 levels of the four weeks ended Aug. 22. Active listings also dropped, down 22% from 2020.
Just over 45% of homes that went under contract in September had an offer within the first two weeks, three percentage points higher than the rate last year. Homes under contract within one week hit 33%, up from 31% a year earlier.
Mortgage applications dropped 1% week-over-week during the period.