Pending Home Sales Drop 13% as Rates Stay High: What This Means for Buyers and Sellers

Pending home sales fell 13% from a year ago in August 2023, according to Redfin. This is the largest year-over-year decline since April 2020, when the housing market was brought to a standstill by the COVID-19 pandemic.

The decline in pending home sales is due to a number of factors, including rising mortgage rates, high home prices, and low inventory. Mortgage rates have more than doubled over the past year, making it more expensive to buy a home. Home prices are also at record highs, making it difficult for buyers to afford a home. And inventory is low, which means that buyers have fewer homes to choose from.

Pending Home Sales Drop 13% as Rates Stay High: What This Means for Buyers and Sellers

The decline in pending home sales is bad news for sellers. It means that it may take longer to sell a home and that sellers may have to accept a lower price. However, the decline in pending home sales is good news for buyers. It means that there will be less competition for homes and that buyers may be able to negotiate a better price.

Here are some tips for buyers and sellers in the current housing market:

Buyers

• Get pre-approved for a mortgage before you start shopping. This will give you an idea of how much money you can borrow and what your monthly payments will be.

• Be prepared to act quickly. In this competitive market, homes are selling quickly. Be prepared to make an offer on a home as soon as you find one that you like.

• Be flexible with your budget and your needs. You may need to be willing to compromise on your budget or your needs in order to find a home that you can afford.

• Work with a qualified real estate agent. A real estate agent can help you find homes that meet your needs and budget, and they can help you negotiate the best price.

Sellers

• Price your home competitively. In this market, it is important to price your home competitively in order to attract buyers.

• Make your home stand out. Make sure that your home is clean and in good condition. You may also want to consider staging your home to make it more appealing to buyers.

• Be prepared to negotiate. Buyers may be less willing to negotiate on price in this market, but it is still important to be prepared to negotiate.

• Work with a qualified real estate agent. A real estate agent can help you price your home correctly and market it to potential buyers.

The decline in pending home sales is a sign that the housing market is cooling. However, it is still a good time to buy or sell a home. Buyers have more negotiating power than they have in the past, and sellers can still get a good price for their home.