MORTGAGE BLOGBlog posted On October 31, 2024
Is it true that some sellers are throwing in the towel? Due to the rising mortgage rates of last year and this year, the percentage of price cuts for homes have risen. Along with the price-cut increase, listings are also receding, which has led to a surge of sellers calling it quits. Thankfully, there are loan programs out there that can benefit sellers and buyers alike.
Examining housing inventory data
HousingWire reported a recent decline in seller’s listings, citing that inventory fell during the week of October 18-25 from 739,434 to 737,997. However, this slight week-to-week decrease could be attributed to Halloween, which is a typical seasonal decline from the last few years. When looking at the bigger picture, there’s actually been progress in inventory growth year after year. HousingWire noted that the same week a year ago, inventory rose from 554,350 to 562,556. So there has definitely been an increase in listings from 2023. Despite a small weekly decrease, listings have actually been rising overtime.
Examining price cuts
We can now take a look at the price-cut data. It’s normal every year for one-third of all homes to take a price cut. Especially in a higher-rate economy, rising rates are directly correlated with a growing number of price cuts. HousingWire reported that price-cut percentages grew from last year, rising from 39% in 2023 to 39.5% in 2024. This was a surprise to many analysts, who had predicted 2.33% national home price growth. The price-cut percentage has remained firm despite forecasts hoping for otherwise.
What can sellers do to get ahead in this current market?
Scratching your head, wondering how you or your clients can sell homes without dropping the price in this fluctuating market? Our program List & Lock™ can offer solutions to sellers’ current housing market woes, especially with rising price cuts and receding listings. A one-of-a-kind way to help sellers advertise discounted rates on their listings, List & Lock can also eliminate buyers' biggest hurdles, generate more interest in listings, and sell faster without dropping the sales price. We also have a new Lock Later option, which allows sellers to still advertise discounted rates but lock the rate later when a qualified buyer is identified. This is an excellent option when rates are expected to drop.*
Not ready to call it quits quite yet with the housing market? If you’re interested in exploring more solutions, reach out to us today — our loan professionals are here to help!
Source: HousingWire
*This lock cannot be transferred to another property address. While List & Lock™ can help buyers significantly, it is not a guarantee to lend. If a buyer is interested in purchasing the listed home at the advertised rate, they must still qualify for the loan. The benefit is that they won’t have to qualify for the loan based on the higher market rates; instead, they will be qualifying on the List & Lock™ rate. They will have several loan options to choose from through List & Lock™ -- Conventional, FHA, VA, and select adjustable-rate mortgages (ARMs). The same type of credit and discount can be applied to other loan programs, but rate adjustments could occur. If you’re concerned your closing could extend beyond the 60-day period, contact your loan officer to discuss extension possibilities.
