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Prices have been rising faster in metro Providence than around Boston, according to Realtor.com.
LOS ANGELES (AP) — Home buyers in Seattle, Silicon Valley, and the nation’s other priciest markets are seeing more properties hit the market as mortgage rates finally start trending lower.
The number of newly listed homes for sale climbed 4.2 percent last month, according to data from Realtor.com. September’s jump was the biggest annual increase since the peak of the spring homebuying season, and helped lift active listings 34 percent from a year earlier, according to Realtor.com.
A dearth of properties for sale is one reason keeping the median US home sale price near record highs. A dearth of properties for sale is one reason keeping the median US home sale price near record highs. The median US home sale price hit a high in June at $426,900.
Last month, the Federal Reserve announced its first interest rate cut in more than four years and signaled more cuts to come this year and through 2026.
The Fed doesn’t set mortgage rates, but its policy pivot cleared a path for mortgage rates to generally go lower. While mortgage rates rose this week economists still expect them to ease in coming months and that could lead to more listings.
“Sellers, especially those who are locked into a low rate, have been waiting for market conditions to change,” said Danielle Hale, chief economist at Realtor.com. “Now that we’re seeing mortgage rates down to their lowest levels in two years, there are signs of movement, with more sellers putting homes on the market, even in what’s typically a real estate shoulder season.”
Lower mortgage rates boost home shoppers’ purchasing power. They also can make selling a home more palatable for homeowners with mortgages that have a fixed rate below current prevailing rates.
The most expensive markets in the country drove much of the increase in newly listed homes last month. That includes metropolitan areas around Seattle, San Josem and Washington, D.C., Realtor.com found.
Home prices have been rising faster in metro Providence than around Boston, according to Realtor.com:
METRO | MEDIAN LIST PRICE SEPT. |
% CHANGE 1 YEAR |
% CHANGE 5 YEARS |
% CHANGE NO. OF LISTINGS 1 YEAR |
---|---|---|---|---|
Boston | $839,900 | 1.1% | 42.5% | 29.8% |
Providence | $567,500 | 3.2% | 49.6% | 32.6% |
Even so, homeowners who can afford to hold off on selling are likely waiting for rates to come down a lot more than they already have.
Consider, as of the second quarter, about 84 percent of all outstanding mortgages had a rate below 6 percent and 56 percent had a rate below 4 percent, according to Realtor.com.
Hale expects the average rate on a 30-year home loan to stay around 6 percent through the end of this year. A year ago, the average rate hit a 23-year high of 7.79%, according to mortgage buyer Freddie Mac. Five years ago, it averaged 3.57 percent, according to the Federal Reserve Bank of St. Louis.
September marked the 11th month in a row with an annual increase in active listings and the highest number of properties on the market since April 2020. The pickup in home listings is good news for the housing market, which has been in a sales slump for more than two years, partly due to a shortage of homes for sale.
Despite the September surge in new listings, the inventory of homes on the market remains below pre-pandemic levels. Active listings were down 23.2 percent last month compared to September 2019, and new listings were off 11.8 percent, according to Realtor.com.
All regions saw a significant bump in new listings compared with September 2023, with newly listed home inventory increasing by 15.6% in the Northeast, 13.4% in the West, 8.3% in the South, and 6.1% in the Midwest.
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