Mortgage rates are falling even further - so why are house prices still so high? The 'sticky' problem, an explanation

With Thanksgiving behind us and Christmas well ahead of us, it's safe to assume that home buyers have put their house hunting on hold until the New Year. But no, the housing market is jumping as always - and even full of surprises lately.
"Housing data for the week including Thanksgiving show that the housing market continues to develop, but not always as expected," explains Realtor.com's chief economist, Danielle Hale, in her weekly analysis.
In our column "How is the housing market this week?" We will detail what is happening with the latest real estate statistics, and what it means for home buyers and sellers.

House price growth has picked up

In November, home prices hovered around a national median of $417,000, down from June's peak of $449,000. And while home prices have grown by double digits year over year for 48 straight weeks, that growth has moderated.
However, in the week ending November 26, house price growth picked up again, with prices 12.2% higher than the same week last year. (In the previous week, the growth rate was only 11%).
"The increase in the typical asking price of houses increased from last week for the first time in seven weeks", notes Hale, but suspects that this is an "aberration".
However, she says, "it's a reminder that prices can be sticky."
"Sticky," it turns out, is a technical term that economists use "to describe variables that are resistant to change, especially when that change is for the worse," according to Hale.
So how sticky are apartment prices? And will they stay stuck for long?
"We noted a few weeks ago that housing price growth may return to single-digit territory right before the end of the year," Hale explains. "It is still possible that we will see this trend materialize before the end of the year. But this week's figures are a signal that you may not see a single-digit increase in housing prices before the new year."

What is not stuck? mortgage rates

The housing market has been hot in recent years, but rising mortgage rates recently put the brakes on, nearly doubling over the past year and surging in late October to a 20-year high of 7.08% for a 30-year fixed term. loan with interest.
Since then, however, rates on the 30-year fixed index have been on a downward trend for the third week in a row, averaging 6.49% for the week ended Dec. 1, according to Freddie Mac.
But will these low mortgage payments spur any buyers to make an offer? probably not.
"This boost at a reasonable price was still not enough to attract more existing home buyers," Hale says. Additionally, even if rates have gone down, they may rise again, and this unpredictability makes planning a challenge. This causes many home buyers to sit on the sidelines and wait for things to settle down.

Registrations continue to rise

The number of homes buyers need to look at continues to grow, rising a staggering 53% over a year ago for the week ending November 26. However, many home buyers will find that the pool simply contains the same outdated listings.
Sure, many sellers were on vacation last week and likely didn't think to list their homes during a long holiday weekend. However, the issue of rising active listings goes deeper than that.
New listings also fell 17% in the week ending Nov. 26 compared to last year. This latest drop marks a grim milestone for buyers: It's the 21st straight week of year-over-year declines in homeowners listing their homes, according to Hale.
"While conditions remain favorable for sellers, with house prices high and houses still selling relatively quickly, the pressure on buyers' affordability weighs on seller confidence," Hale explains.
So what's a frustrated buyer to do?
Some are looking for new construction to find the kinds of home features missing from the dusty listing pages.
"Actually, new home sales rose slightly in October," says Hale.

The meaning of increasing days on market for buyers and sellers

A typical property spent an extra week on the market, for the week ending November 26. This marks an 18-week run with houses lasting longer than last year. (The average number of days a home spent on the market in November was 56.)
Homes staying on the market means homebuyers have an advantage – although generally homes are selling faster than before 2019.
But overall, "buyers are closer to the driver's seat in the housing market than they have been in a long time," Hale says.
Therefore, sellers looking to close a deal before the end of the year should take a close look at their local market before pricing their homes too high.
"Although housing markets are generally cooling, lower-priced markets in the Northeast and Midwest are seeing homes sell faster than other regions," says Hale.

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