What’s the reason for the jump in mortgage applications?
Mortgage applications saw an increase week-over-week despite mortgage rates remaining stubbornly elevated. CNBC spoke with Matthew Graham, the chief operating officer of Mortgage News Daily, to understand his perspective on the increase in applications.
Graham stated, “When it comes to mortgage applications it’s better to take a longer view and not get bogged down in nitty gritty, week-to-week movements.”
When asked about where he saw rates going, Graham said, “I think a lot of people would argue that we’ve seen it already last year when we hit 8%. To a large extent, we’re in the middle of it right now. The people that are driving the market on the purchase side are people that really need to buy a home, and they’re not letting interest rates enter in to their decision making.”
Which metro areas are seeing homes sit the longest?
While some areas of the U.S. are heating up, there are metros that have seen homes sit on the market for a little longer. The national average for number of days on market for an existing home is about 50 days. The team at Realtor.com found the 12 metro areas in which homes are taking the longest to sell.
Danielle Hale, chief economist at Realtor.com, said, “Some of these markets are perennially slow-moving. They tend to be smaller markets that are not on the radar of most buyers.”
The top spot for the slowest market in the U.S. was a tie between Lafayette, LA and Punta Gorda, FL with both metro areas seeing a median number of days on the market at 69 days. Florida actually had three markets in the top 10 with Crestview, FL coming at sixth place, and Naples, FL at 10th place.
Why does this matter to a potential home buyer? Slow selling homes are more likely to see price cuts or have a home seller that may be more willing to negotiate. A market that moves slowly may actually be an advantage for a homebuyer.
Are home sellers getting more realistic?
A recent survey by Realtor.com asked home sellers what they’re expecting from the spring housing market.
When asked if they expect to see a bidding war for their home, only 12% did. That’s down significantly when compared to 27% in 2023. Only 15% responded that they expected to get more than their asking price. That’s also down from 31% in 2023.
When it came to velocity of offers, only 15% expected to get an offer within a week. That’s less than half of the 37% mark for the same question in 2023. Also, only 15% expected buyers would be willing to forgo contingencies like inspections and appraisals. That’s down from 35% in 2023.
All-in-all, the home seller survey painted a picture of a market that seems to be shifting from a strong seller’s market towards a market that’s a bit more equitable for everyone. Only time will tell if that proves to be the case this year.
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