San Diego pending home sales fall 11.7% in early August

U.S. pending home sales edged higher in early August, while a surge in new listings gave buyers more options in a housing market still constrained by elevated mortgage rates.

Pending home sales rose 0.4% week-over-week during the four weeks ending Aug. 9, according to a report Thursday from Redfin. But pending sales remained near their lowest level since March and were down 1.6% from a year earlier.

Mortgage-purchase applications rose 3% from the previous week, another indication that some buyers may be returning to the market. Still, the average weekly mortgage rate climbed to 6.69%, its highest level in more than a year, pushing the typical monthly housing payment to $2,626, up 1.7% from a year earlier.

The latest data suggest the housing market may be showing tentative signs of life rather than a sustained recovery, Redfin said.

New listings provided a stronger signal. The number of U.S. homes newly listed for sale rose 1.7% from the previous week, the biggest weekly increase in five months, according to the report. Total active listings increased 0.7% to about 1.48 million.

The additional inventory is giving buyers more leverage in many markets, particularly as homes remain on the market longer.

"Buyers should know that this isn't 2021 and 2022; the sellers' list price is a starting point for negotiations," Sheryl Wingate, a Redfin agent in the greater Seattle area, said in a statement.

Wingate said buyers can ask sellers for concessions and negotiate, although some properties remain highly competitive.

Clean, move-in-ready homes that are relatively affordable continue to attract buyers quickly, while luxury properties are drawing buyers who are less sensitive to mortgage rates and broader economic conditions, she said.

The national median sale price was $403,706 during the four weeks ending Aug. 9, up 2.2% from a year earlier, according to Redfin. The median asking price was $397,008, up 1.2%.

The report found homes spent a median of 42 days on the market, unchanged from a year earlier. About 21% of listings had price reductions, while 27.2% of homes sold above their list price, up from about 26%.

The average sale-to-list price ratio rose to 98.9% from 98.7%, Redfin said.

The supply of homes remained below what is generally considered a balanced market. There were 3.7 months of supply, compared with the 4 to 5 months typically associated with balanced conditions.

San Diego was among the major metropolitan areas where pending sales fell sharply. Pending sales in the region declined 11.7% from a year earlier, the third-largest decline among the 50 most populous U.S. metros tracked by Redfin.

The decline put San Diego behind only Seattle, where pending sales fell 18.5%, and Houston, where they dropped 15.9%.

San Diego was not among the metros with the largest year-over-year changes in median sale prices or new listings. The largest gains in median sale prices were recorded in Newark, N.J. (9.9%), West Palm Beach, Fla. (9%), San Francisco (7.8%), Chicago (7.7%), and St. Louis (7.6%).

On the downside, median sale prices fell 3.8% in Seattle, 3% in San Jose, 2.2% in Austin, Texas, 1.6% in Las Vegas and 1.5% in Dallas.

Redfin's data cover more than 900 U.S. metropolitan areas and include homes listed and/or sold during the four-week period.

Other indicators also showed mixed conditions. The daily average 30-year fixed mortgage rate was 6.74% on Aug. 12, down from 6.83% a week earlier but above the 6.57% level of a year earlier.

Touring activity was 12% above the start of the year as of Aug. 8, but that was well below the 29% increase recorded at the same point last year.

The combination of higher borrowing costs, economic uncertainty and cautious buyers continues to weigh on the housing market, even as rising inventory creates more opportunities for those who are willing and able to buy, Redfin said.