Higher home prices in June offset by rise in listings

June’s housing market data shows a mixed bag for prospective homebuyers as prices hit a new all-time high but monthly mortgage payments decreased, a report from Redfin said. 

U.S. house values reached a peak in June with the median home sale price coming in at $397,954, the biggest increase since March. This led to a 5% decline in pending sales, the real estate brokerage reported.

With the new record, affordability is even more out of reach for many potential homeowners. The affordability crunch is unlikely to change by the end of 2024, according to First American Data & Analytics’ Real Home Price Index. 

“Unfortunately, inflation has proven stubborn and led to the Federal Reserve’s ‘higher-for-longer’ stance on interest rates, contributing to an elevated outlook for mortgage rates, while house prices have once again demonstrated their ‘downside stickiness,'” said chief economist Mark Fleming at First American Financial, First American Data & Analytics’ parent company. 

Redfin found that June’s pending home sales posted their biggest decline since February, as the median sale price rose 5% from last year.

The good news for prospective homeowners, however, is that more new listings are on the market for them to choose from, Redfin reported. Also, monthly housing payments decreased by nearly $100 from their peak in April. 

New listings jumped 10% in June, the biggest increase seen in two months. Over 100,000 new listings landed on the market, a 9.9% increase year-over-year. 

As of July 2, the daily average 30-year fixed mortgage rate sat at 7.13%. The latest metric is up from a three-month low of 6.97% that was seen three weeks earlier. Fortunately, the current number is still a ways away from a five-month high of 7.52% in early May. 

“While affordability is likely to remain constrained for the remainder of 2024, mortgage rates are expected to come down in 2025, which would be welcome news for potential home buyers,” Fleming continued.