According to a recent Redfin research, more people are beginning their home search as the new year gets underway. In the week ending January 5, Redfin’s Homebuyer Demand Index, a seasonally adjusted indicator of tours and other purchasing services from Redfin agents, reported a little 2% increase from the previous month and a 2% year-over-year gain.
A few more buyers are out there for a number of reasons: High mortgage rates have been accepted by some; the daily average rates reached a seven-month high this week and are not expected to drop much anytime soon. Now that the holidays are gone and the new year has begun, some people are leaping into the market, and others are taking advantage of the fact that there are more properties available than there have been in previous years.
“Three of the four offers my clients have made in the last week have competed against other offers with competitive terms, like waiving all contingencies and releasing earnest money early. Some homes are getting multiple offers within 24 hours of hitting the market,” said Emily Lam, a Redfin Premier agent in the Seattle area. “Some buyers are getting serious about their search because they’ve come to terms with 7% rates and they’re worried that if they wait longer, home prices will just keep rising. Others are starting their search in hopes that rates will decline soon. Either way, I’m advising buyers to get serious now because desirable listings will get more competitive as the year goes on.”
The slight increase in tours hasn’t yet resulted in a rise in sales nationwide. During the four weeks ending January 5, pending house sales decreased 3.1% from the same period last year; however, this decline might be inflated because Redfin is comparing it to a time last year when mortgage rates saw a significant decline, which boosted demand.
New listings are down 2.5% on the selling side, which is the largest drop in more than a year. However, for the reasons mentioned above, that drop can seem bigger than it is. In order to ascertain whether more home tours ultimately result in more home sales and whether more sellers begin selling their properties as we settle into 2025, Redfin will closely monitor pending transactions and new listings over the coming weeks.
To read the full report, click here.
