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Miami Herald
7 days ago
- Business
- Miami Herald
Number of Home Sales Falling Through Hits Record Level
The number of pending home sales that fell through hit record-levels for the month of June in 2025, as surging inventory and economic uncertainty continues to plague sellers. According to analysis by real estate firm and brokerage Redfin, over 57,000 home-sale agreements across the U.S. were cancelled in June, equating to around 15 percent of houses that were under contract in the month. This is up from 14 percent a year ago, and marks the highest cancellation rate for any June on record. Redfin said in its analysis that record levels of home sales falling through serves as a reflection of persistent economic unease among buyers, as well as the issues of affordability, inflation and high mortgage rates that may be weighing on their minds. The increased fiscal risks associated with homeownership have also contributed to rising levels of inventory, reducing sellers' leverage and putting power over the housing market more firmly in the hands of prospective buyers. Real estate agents who spoke to Redfin said buyers are becoming reluctant to finalize purchases due to economic uncertainties, in particular high mortgage rates, the potential impacts of tariffs, inflation and the possibility of a recession in the near future. Others noted that surging levels of inventory have put power in the hands of buyers, leading many to cancel deals when another home within their price range is listed. According to June Housing Market Trends Report, the number of homes for sale in the U.S. rose nearly 30 percent year-over-year, marking the 20th consecutive month of increases. The latest market report from Zillow, and recent data from the St. Louis Fed, similarly showed that housing inventory has risen to post-Covid highs. Analysis from Redfin in May said that high levels of inventory, coupled with subdued demand, had led to a buyer surplus of nearly 500,000. It said that this marks the largest gap between buyers and sellers since 2013. Despite buyers having greater choice, high prices, mortgage rates, and economic uncertainties have continued to sideline buyers and weigh on home sales in 2025. According to data released Wednesday by the National Association of Realtors, existing home sales fell by 2.7 percent in June to a nine-month low of 3.9 million. Median home prices also rose to $435,300, marking a record high for June and the 24th consecutive month of year-over-year increases. Prior to the release, President Trump on Tuesday blamed persistently weak home sales on Federal Reserve Chair Jerome Powell, and the central bank's reluctance to lower interest rates, which would likely contribute to mortgage rates declining. "People aren't able to buy a house because this guy is a numbskull," Trump told reporters in the Oval Office. "He keeps the rates too high." Crystal Zschirnt, a Redfin Premier agent in Dallas, said: "Buyers have leverage. Some buyers are canceling deals because another home pops up in the same price range that they like better, or because they discover a flaw and get nervous it'll cost too much to fix. I've also heard of some buyers backing out because they're hoping home prices or mortgage rates are going to plummet soon, even though that's unlikely." Nancy Vanden Houten, Lead Economist at Oxford Economics, in comments shared with Newsweek on June's home sales data: "Existing home sales were weaker than expected in June, but we don't think the decline marks the start of a sustained downturn in sales. We look for sales to move sideways over the balance of 2025, before recovering in 2026 as rate cuts by the Federal Reserve get underway in earnest." "Increases in supply should temper home price growth and support sales. Median home prices rose to a record high in June, but the increase was at least partly due to seasonal quirks and we think price growth will trend lower in the second half of this year," she added. According to Redfin's forecasts, home prices are expected to decline one percent by the end of the year compared to 2024. Despite hopes of mortgage rates soon dropping to six percent, which analysts believe could inject much-needed momentum into U.S. home sales, it anticipates these remaining effectively unchanged at around 6.8 percent. Related Articles The Mortgage Rate Shift That Could Change the Housing MarketRenting vs. Buying: US Cities Where Renters Save the MostCalifornia Faces Pileup of Unsold HomesMap Shows Where Chinese Citizens Are Buying Property Across US 2025 NEWSWEEK DIGITAL LLC.
Miami Herald
7 days ago
- Business
- Miami Herald
The Mortgage Rate Shift That Could Change the Housing Market
Owning a home remains prohibitively expensive for many Americans, but experts believe a modest decline in mortgage rates could inject much-needed momentum into home sales and help revive the broader U.S. housing market. According to recent analysis from the National Association of Realtors (NAR), were mortgage rates to drop to 6 percent, an additional 5.5 million households would be able to afford a home, including 1.6 million renters. Affordability remains one of the key issues threatening the stability of the U.S. housing market. As experts have warned, the rising costs of buying a home-which have dragged ownership rates to a post-pandemic low this year-are exacerbated by persistently high borrowing costs, preventing a large number of Americans from entering the property market. Economists have recently pointed to higher-than-usual mortgage rates as a critical drag on the U.S. housing market, and others are now dubbing a possible drop to 6 percent as a "magic" figure that would expand the number of Americans who are able to buy. According to data from key organizations within the housing and mortgage markets, including the Mortgage Bankers Association (MBA) and the Federal Home Loan Mortgage Corporation (Freddie Mac), 30-year fixed mortgage rates are currently hovering at around about 6.75 percent. While these are below the levels seen in October 2023, when 30-year rates surged to around 8 percent, they are a far cry from the lows of under 3 percent during the pandemic. The rates have pushed homeownership out of reach for many. According to Housing Market Trends Report for June, the number of homes for sale in the U.S. rose nearly 30 percent year over year, marking the 20th straight month of increases. The latest market report from Zillow similarly showed that housing inventory hit a five-year high in June. NAR's research found that even a modest drop in rates to 6 percent would boost home sales by an estimated 3 percent in 2025 and by 14 percent in 2026. It added that approximately 10 percent of the additional households now able to buy would do so over 12 to 18 months. According to Mortgage News Daily's loan calculator, a 6 percent rate on 30-year mortgages would lower the monthly payment on a $300,000 loan to $1,799 from $1,946 at today's rates. NAR said that Atlanta, Dallas, Minneapolis, Cleveland, and Kansas City would see the greatest increase in home sales activity if rates dropped to 6 percent. Susan Wachter, an economist and professor of finance and real estate at the University of Pennsylvania's Wharton business school, told Newsweek that 6 percent could prove "a magic mortgage number that will push Americans to buy." However, she added that this will depend on the direction of inflation, and the Federal Reserve's response in the form of lower interest rates. Alexei Morgado, real estate agent and founder of Lexawise, told "Many of my clients tell me the same thing: They want to buy, but they feel that mortgage rates are holding them back." "And it's not just about the number itself," he continued. "What I hear most often is the fear of making a bad decision, of getting into something they can't sustain or that will later make them think, 'I rushed into it.' That feeling of paying more for the same thing is frustrating, discouraging, and puts them on hold." Susan Wachter of theUniversity of Pennsylvania's Wharton School told Newsweek: "Six percent could be a magic mortgage number that will push Americans to buy, but only if it comes about because inflation declines, bringing interest rates down, without a recession. The fear of buyers' remorse in a housing slowdown is sidelining buyers, including those who would newly qualify for a mortgage with rate drops." NAR Chief Economist Lawrence Yun, speaking to real estate professionals at the Residential Economic Issues & Trends Forum last month, said: "Your past clients are all happy. But for new homebuyers, their monthly payment obligation has increased, and this is what's killing the housing market. Mortgage rates are the magic bullet, and we're waiting and waiting until those come down." NAR Chief Economist Yun forecasts that mortgage rates will average 6.4 percent in the second half of 2025, and 6.1 percent next year. Related Articles Map Shows Cities Where Residents Are Looking to Move AwayYou Can Now Co-Own a 6-Bed Montecito MansionHow Tax Breaks for Homeowners Can Affect Your 2025 ReturnsHow Much Boomers, Millennials and Gen Z Spent on Their Homes in 2024 2025 NEWSWEEK DIGITAL LLC.
Newsweek
7 days ago
- Business
- Newsweek
Number of Home Sales Falling Through Hits Record Level
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. The number of pending home sales that fell through hit record-levels for the month of June in 2025, as surging inventory and economic uncertainty continues to plague sellers. According to analysis by real estate firm and brokerage Redfin, over 57,000 home-sale agreements across the U.S. were cancelled in June, equating to around 15 percent of houses that were under contract in the month. This is up from 14 percent a year ago, and marks the highest cancellation rate for any June on record. Why It Matters Redfin said in its analysis that record levels of home sales falling through serves as a reflection of persistent economic unease among buyers, as well as the issues of affordability, inflation and high mortgage rates that may be weighing on their minds. The increased fiscal risks associated with homeownership have also contributed to rising levels of inventory, reducing sellers' leverage and putting power over the housing market more firmly in the hands of prospective buyers. What To Know Real estate agents who spoke to Redfin said buyers are becoming reluctant to finalize purchases due to economic uncertainties, in particular high mortgage rates, the potential impacts of tariffs, inflation and the possibility of a recession in the near future. Others noted that surging levels of inventory have put power in the hands of buyers, leading many to cancel deals when another home within their price range is listed. According to June Housing Market Trends Report, the number of homes for sale in the U.S. rose nearly 30 percent year-over-year, marking the 20th consecutive month of increases. The latest market report from Zillow, and recent data from the St. Louis Fed, similarly showed that housing inventory has risen to post-Covid highs. Analysis from Redfin in May said that high levels of inventory, coupled with subdued demand, had led to a buyer surplus of nearly 500,000. It said that this marks the largest gap between buyers and sellers since 2013. A for sale sign is displayed outside of a home for sale on August 16, 2024 in Los Angeles, California. A for sale sign is displayed outside of a home for sale on August 16, 2024 in Los Angeles, California. Patrick T. Fallon/AFP via Getty Images Despite buyers having greater choice, high prices, mortgage rates, and economic uncertainties have continued to sideline buyers and weigh on home sales in 2025. According to data released Wednesday by the National Association of Realtors, existing home sales fell by 2.7 percent in June to a nine-month low of 3.9 million. Median home prices also rose to $435,300, marking a record high for June and the 24th consecutive month of year-over-year increases. Prior to the release, President Trump on Tuesday blamed persistently weak home sales on Federal Reserve Chair Jerome Powell, and the central bank's reluctance to lower interest rates, which would likely contribute to mortgage rates declining. "People aren't able to buy a house because this guy is a numbskull," Trump told reporters in the Oval Office. "He keeps the rates too high." What People Are Saying Crystal Zschirnt, a Redfin Premier agent in Dallas, said: "Buyers have leverage. Some buyers are canceling deals because another home pops up in the same price range that they like better, or because they discover a flaw and get nervous it'll cost too much to fix. I've also heard of some buyers backing out because they're hoping home prices or mortgage rates are going to plummet soon, even though that's unlikely." Nancy Vanden Houten, Lead Economist at Oxford Economics, in comments shared with Newsweek on June's home sales data: "Existing home sales were weaker than expected in June, but we don't think the decline marks the start of a sustained downturn in sales. We look for sales to move sideways over the balance of 2025, before recovering in 2026 as rate cuts by the Federal Reserve get underway in earnest." "Increases in supply should temper home price growth and support sales. Median home prices rose to a record high in June, but the increase was at least partly due to seasonal quirks and we think price growth will trend lower in the second half of this year," she added. What Happens Next? According to Redfin's forecasts, home prices are expected to decline one percent by the end of the year compared to 2024. Despite hopes of mortgage rates soon dropping to six percent, which analysts believe could inject much-needed momentum into U.S. home sales, it anticipates these remaining effectively unchanged at around 6.8 percent.
Newsweek
7 days ago
- Business
- Newsweek
The Mortgage Rate Shift That Could Change the Housing Market
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Owning a home remains prohibitively expensive for many Americans, but experts believe a modest decline in mortgage rates could inject much-needed momentum into home sales and help revive the broader U.S. housing market. According to recent analysis from the National Association of Realtors (NAR), were mortgage rates to drop to 6 percent, an additional 5.5 million households would be able to afford a home, including 1.6 million renters. Why It Matters Affordability remains one of the key issues threatening the stability of the U.S. housing market. As experts have warned, the rising costs of buying a home—which have dragged ownership rates to a post-pandemic low this year—are exacerbated by persistently high borrowing costs, preventing a large number of Americans from entering the property market. Economists have recently pointed to higher-than-usual mortgage rates as a critical drag on the U.S. housing market, and others are now dubbing a possible drop to 6 percent as a "magic" figure that would expand the number of Americans who are able to buy. What To Know According to data from key organizations within the housing and mortgage markets, including the Mortgage Bankers Association (MBA) and the Federal Home Loan Mortgage Corporation (Freddie Mac), 30-year fixed mortgage rates are currently hovering at around about 6.75 percent. While these are below the levels seen in October 2023, when 30-year rates surged to around 8 percent, they are a far cry from the lows of under 3 percent during the pandemic. The rates have pushed homeownership out of reach for many. According to Housing Market Trends Report for June, the number of homes for sale in the U.S. rose nearly 30 percent year over year, marking the 20th straight month of increases. The latest market report from Zillow similarly showed that housing inventory hit a five-year high in June. In an aerial view, single family homes on April 19, 2025 in Thousand Oaks, California. In an aerial view, single family homes on April 19, 2025 in Thousand Oaks, research found that even a modest drop in rates to 6 percent would boost home sales by an estimated 3 percent in 2025 and by 14 percent in 2026. It added that approximately 10 percent of the additional households now able to buy would do so over 12 to 18 months. According to Mortgage News Daily's loan calculator, a 6 percent rate on 30-year mortgages would lower the monthly payment on a $300,000 loan to $1,799 from $1,946 at today's rates. NAR said that Atlanta, Dallas, Minneapolis, Cleveland, and Kansas City would see the greatest increase in home sales activity if rates dropped to 6 percent. Susan Wachter, an economist and professor of finance and real estate at the University of Pennsylvania's Wharton business school, told Newsweek that 6 percent could prove "a magic mortgage number that will push Americans to buy." However, she added that this will depend on the direction of inflation, and the Federal Reserve's response in the form of lower interest rates. What People Are Saying Alexei Morgado, real estate agent and founder of Lexawise, told "Many of my clients tell me the same thing: They want to buy, but they feel that mortgage rates are holding them back." "And it's not just about the number itself," he continued. "What I hear most often is the fear of making a bad decision, of getting into something they can't sustain or that will later make them think, 'I rushed into it.' That feeling of paying more for the same thing is frustrating, discouraging, and puts them on hold." Susan Wachter of the University of Pennsylvania's Wharton School told Newsweek: "Six percent could be a magic mortgage number that will push Americans to buy, but only if it comes about because inflation declines, bringing interest rates down, without a recession. The fear of buyers' remorse in a housing slowdown is sidelining buyers, including those who would newly qualify for a mortgage with rate drops." NAR Chief Economist Lawrence Yun, speaking to real estate professionals at the Residential Economic Issues & Trends Forum last month, said: "Your past clients are all happy. But for new homebuyers, their monthly payment obligation has increased, and this is what's killing the housing market. Mortgage rates are the magic bullet, and we're waiting and waiting until those come down." What Happens Next? NAR Chief Economist Yun forecasts that mortgage rates will average 6.4 percent in the second half of 2025, and 6.1 percent next year.
Yahoo
13-05-2025
- Business
- Yahoo
U.S. Households Now Need 70% More Income To Buy A Home—Double Whammy Of Skyrocketing Prices And Rates Puts Homeownership Out Of Reach For Many
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. As if you needed proof of the housing crisis facing many Americans, a new report by reveals that the income required to buy a home has soared by a mighty 70% since spring 2019. According to the April 2025 Housing Market Trends Report, the household income needed to buy a home has increased by $47,000. This means that if a buyer wished to purchase a home at April's national median list price of $431,250, they would need to earn an annual income of $114,000, buy with a 30-year mortgage, and make a 20% down payment, according to Don't Miss: Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — The numbers factor in the homeowner not spending more than 30% of their gross income on their housing costs, which would account for their mortgage payment, taxes, and insurance. It effectively puts many middle-class workers out of the home-buying pool because an owner would need to make around $9,500 a month before taxes to cover their housing expenses. According to the U.S. Census Bureau, a typical American household earned just over $80,600 per year, in 2023, over 40% less than the figure needed to buy a home today. 'While the income needed to purchase a home has leveled off nationally over the past year, it remains significantly higher than before the [COVID-19] pandemic, underscoring the ongoing challenge of affordability even as market conditions gradually rebalance,' Chief Economist Danielle Hale said. Trending: Hasbro, MGM, and Skechers trust this AI marketing firm — According to data, the income needed to buy a home varies dramatically across the nation and spiked in some cities more than others since 2019. Memphis, Tennessee, has seen the greatest required salary spike of 94.8%. It means a potential buyer of an averagely priced home of $345,495 would need to make $91,300 a year. Providence, Rhode Island, was next, requiring a salary of $154,615 to buy a home costing $584,900 — a 93% increase, In third place was Las Vegas, which required an income of $125,654 to buy a home costing $475,000 — an 86.5% increase. These numbers do not reflect the cost of living, which, according to the Bureau of Labor Statistics has decreased by 2.4% over the last year. However, the potential impact of tariffs remains to be potential would-be buyers looking to purchase a new home, tariffs could increase new home prices by $10,000, Usha Haley, professor of international business and management at the Wichita State University Barton School of Business told U.S. News & Wold Report, 'not including potential delays and supply chain disruptions,' she added. 'Shifting gears to domestic products for construction is possible, but will take time. The United States has over 300 billion trees, but not the industrial capacity to meet housing demand within the next couple of years,' Haley said. Interest rates are the big unknown. If they dropped, the amount homeowners would need to earn would also fall. However, as tariffs begin to bite, that does not seem on the cards, according to media reports, despite President Donald Trump's pressuring of the Federal Reserve to lower rates. Read Next: Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – Image: Shutterstock Send To MSN: 0 This article U.S. Households Now Need 70% More Income To Buy A Home—Double Whammy Of Skyrocketing Prices And Rates Puts Homeownership Out Of Reach For Many originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
