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U.S. pending home sales dropped 4% Y/Y during the first four weeks of December, registering the smallest drop since March 2022 and signaling a potential rebound in the residential real estate market, Redfin said Thursday.
Active listings showed a similar trajectory, dipping 3.8% Y/Y to 817,863 during the same period, marking the smallest decline since June 2023. New listings rose 12% Y/Y to 53,243, its biggest increase since June 2021, in contrast to a slump a year ago.
The median sale price rose 4.5% Y/Y to $364,250, the biggest gain since October 2022. Redfin said the December 2023 increase is partly because rapidly rising mortgage rates at this time last year were constraining home prices.
Note that as of Dec. 28, 2023, the 30-year fixed-rate mortgage averaged 6.61%, down from 6.67% a week ago and compared with 6.42% at this time last year, Freddie Mac said Thursday.
Freddie Mac Chief Economist Sam Khater also sees signs of the housing market reviving as mortgage rates moderate. “Heading into the new year, the economy remains on firm ground with solid growth, a tight labor market, decelerating inflation, and a nascent rebound in the housing market,” he said.
The National Association of Realtors’ Pending Home Sales Index, posted a 5.2% Y/Y decline in November.
In Thursday midday trading, the Real Estate Select Sector SPDR (NYSEARCA:XLRE) ticked up 0.1%, iShares U.S. Home Construction ETF (BATS:ITB) edged down 0.2%, and iShares Mortgage Real Estate ETF (BATS:REM) slipped 0.6%.
Real estate broker stocks were mixed. Anywhere Real Estate (NYSE:HOUS) gained 0.3%, Redfin (NASDAQ:RDFN) advanced 1.7%, Re/Max (RMAX) jumped 3.5%, Zillow class C shares (NASDAQ:Z) fell 0.9%, eXp World Holdings (NASDAQ:EXPI) +1.0%, Compass (NYSE:COMP) -3.1%, and Opendoor Technologies (NASDAQ:OPEN) -1.1%.