Mortgage rate dip makes for a lively 'last call' in this year's home shopping season
Rhea-AI Summary
Zillow's latest market report reveals increased activity in the housing market due to lower mortgage rates. Home sales and new listings moved closer to pre-pandemic norms in September, with sales down 22.2% and new listings down 17% compared to pre-pandemic averages. The typical U.S. home value is now just under $361,000, down 0.2% from August but up 2.4% year-over-year.
Lower mortgage rates boosted buying power, with a two-year low of 6.08% in late September increasing affordability by over $40,000 for some buyers. The share of listings with price cuts decreased to 25.1% in September. Buyers markets are spreading across the Southeast, with 10 of the 50 biggest metros now favoring buyers, primarily in Florida, Georgia, Texas, Tennessee, and Louisiana.
The report warns that mortgage rates remain volatile, emphasizing the importance of buyers being prepared for market fluctuations.
Positive
- Home sales and new listings moved closer to pre-pandemic norms
- Lower mortgage rates increased buying power by over $40,000 for some buyers
- Typical U.S. home value up 2.4% year-over-year
- Share of listings with price cuts decreased to 25.1% in September
Negative
- Typical U.S. home value down 0.2% from August
- Home sales still down 22.2% compared to pre-pandemic norms
- New listings still down 17% compared to pre-pandemic averages
- Volatile mortgage rates may impact market stability
News Market Reaction
On the day this news was published, ZG gained 1.05%, reflecting a mild positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
- New listings and sales moved closer to pre-pandemic norms in September.
- A buyer who could have afforded the typical
U.S. home in May saw their buying power boosted by more than$40,000 - Buyers markets are spreading across the Southeast, with more homes for sale than in most other areas of the country.
For a buyer who could have afforded the mortgage payment on a typical home in May, mortgage rates falling to a two-year low of
"September proved the readiness of both buyers and sellers to return when conditions are right. Lower mortgage rates helped more buyers clear the affordability hurdle, and gave buyers already in the market more homes to choose from," said Skylar Olsen, Zillow chief economist. "The mortgage rate spike after a strong jobs report early this month gave back some of those affordability gains, at least for now. Buyers should be prepared for more ups and downs, which means it's crucial to have their finances in order and their expert team in place to act quickly, but not rashly, when they find the right house."
An uptick in activity from both buyers and sellers kept home values more or less in balance. The typical
Trends in price cuts and time on market help illustrate the bump in competition felt by buyers in September. The share of listings with a price cut fell to
Before the pandemic, the time between a home being listed and having an offer accepted grew by an average of three days from August to September. This year, it was only one day, from 20 days for the median home sold in August to 21 days in September.
Buyers markets are spreading across the Southeast
While the housing market nationwide remains neutral, according to Zillow's market heat index,
The trend in new listings goes a long way toward explaining why some markets are more competitive than others. While new listings in September were close to, or even above, pre-pandemic norms in many markets in the Southeast, in markets along both coasts, homeowners are continuing to hold onto their current homes in greater numbers, meaning fewer new listings are hitting the market. That relative lack of options makes the market feel more competitive for buyers in those areas. More plentiful new construction in the South plays a role in unlocking more inventory, as well.
What's ahead
October is traditionally when the share of listings with a price cut peaks, as sellers make last-ditch efforts to attract buyers ahead of the holiday season. It remains to be seen whether September's market heat will continue into October, even with mortgage rates rising to
As the early October rise in mortgage rates shows, there is no guarantee they will continue to fall, even if, as expected, the Fed cuts its key rate further. New macroeconomic data will continue to change expectations for the size and speed of future rate cuts, and move mortgage rates. Zillow Home Loans' BuyAbility℠ tool helps home shoppers keep up with what they can afford in real time as mortgage rates change.
Metro Area* | Zillow Home Value Index (ZHVI) | ZHVI Change, Year over Year (YoY) | Market Favors** | New Listings Change, YoY | New Listings Change, Since Before the Pandemic | Share of Listings with a Price Cut | Days to Pending |
2.4 % | Neutral | -1.2 % | -17.0 % | 25.1 % | 21 | ||
7.1 % | Strong seller | -2.5 % | -37.1 % | 15.8 % | 29 | ||
5.1 % | Seller | 16.2 % | -20.1 % | 20.9 % | 21 | ||
4.9 % | Seller | -0.4 % | -20.0 % | 27.4 % | 13 | ||
-0.3 % | Neutral | 0.7 % | -10.0 % | 32.9 % | 34 | ||
0.4 % | Neutral | 2.6 % | 2.3 % | 28.0 % | 35 | ||
3.5 % | Seller | 7.7 % | -20.4 % | 23.9 % | 10 | ||
4.5 % | Seller | 0.3 % | -20.0 % | 24.8 % | 13 | ||
3.2 % | Buyer | 1.2 % | -5.6 % | 21.9 % | 45 | ||
1.6 % | Buyer | -2.0 % | -21.0 % | 29.4 % | 32 | ||
5.2 % | Strong seller | 13.4 % | -24.8 % | 21.9 % | 9 | ||
0.5 % | Neutral | 7.2 % | -15.8 % | 31.7 % | 26 | ||
1.7 % | Seller | 7.0 % | -16.3 % | 20.6 % | 16 | ||
4.2 % | Seller | 5.6 % | -27.4 % | 21.8 % | 25 | ||
4.2 % | Neutral | 3.5 % | -20.3 % | 25.9 % | 13 | ||
4.3 % | Neutral | 10.8 % | -22.0 % | 28.0 % | 14 | ||
0.2 % | Seller | -0.8 % | -23.5 % | 28.0 % | 25 | ||
4.8 % | Seller | 10.3 % | -24.6 % | 26.6 % | 21 | ||
-0.5 % | Buyer | -13.8 % | -19.5 % | 31.0 % | 40 | ||
0.3 % | Neutral | -2.3 % | -18.0 % | 33.8 % | 25 | ||
2.5 % | Seller | 0.1 % | -21.8 % | 26.6 % | 11 | ||
3.0 % | Seller | -3.8 % | -15.6 % | 25.6 % | 8 | ||
0.9 % | Buyer | -3.8 % | -12.7 % | 29.2 % | 34 | ||
2.1 % | Neutral | 4.6 % | -6.8 % | 26.9 % | 25 | ||
-2.7 % | Buyer | -11.0 % | -0.7 % | 29.6 % | 52 | ||
0.5 % | Seller | -1.7 % | -26.7 % | 28.6 % | 21 | ||
1.7 % | Seller | 3.4 % | -27.6 % | 27.4 % | 19 | ||
2.1 % | Neutral | 1.6 % | -10.6 % | 28.8 % | 14 | ||
3.6 % | Neutral | -7.9 % | -16.8 % | 29.9 % | 9 | ||
-4.0 % | Buyer | -19.8 % | -12.3 % | 28.3 % | 64 | ||
5.7 % | Neutral | 10.7 % | -27.5 % | 28.0 % | 23 | ||
2.7 % | Neutral | 0.3 % | -20.0 % | 29.7 % | 10 | ||
3.2 % | Neutral | 0.1 % | -15.1 % | 33.2 % | 8 | ||
2.4 % | Neutral | -1.0 % | -11.2 % | 33.1 % | 14 | ||
5.7 % | Seller | -7.6 % | -16.5 % | 25.5 % | 9 | ||
7.8 % | Strong seller | 13.2 % | -15.7 % | 18.7 % | 13 | ||
1.1 % | Buyer | -1.8 % | -17.3 % | 32.1 % | 28 | ||
4.2 % | Seller | -5.9 % | -12.8 % | 24.7 % | 28 | ||
7.0 % | Strong seller | 15.6 % | -31.3 % | 22.4 % | 12 | ||
-0.3 % | Buyer | -4.2 % | -7.9 % | 29.0 % | 46 | ||
4.8 % | Neutral | -3.6 % | -4.0 % | 20.7 % | 25 | ||
1.9 % | Neutral | -4.4 % | 2.2 % | 30.4 % | 25 | ||
1.2 % | Neutral | 6.4 % | -8.7 % | 34.3 % | 17 | ||
0.1 % | Buyer | -9.7 % | -9.1 % | 27.8 % | 30 | ||
4.1 % | Seller | 6.7 % | -15.3 % | 25.5 % | 9 | ||
3.1 % | Neutral | -3.8 % | -22.8 % | 29.8 % | 11 | ||
-4.0 % | Buyer | -22.0 % | 8.2 % | 21.9 % | 49 | ||
1.3 % | Seller | -3.5 % | -30.9 % | 33.8 % | 20 | ||
7.6 % | Strong seller | 0.1 % | -28.0 % | 19.7 % | 8 | ||
5.9 % | Strong seller | 2.2 % | -14.7 % | 20.6 % | 13 | ||
-0.7 % | Neutral | 0.7 % | -12.4 % | 25.3 % | 19 |
*Table ordered by market size |
**According to Zillow's market heat index |
About Zillow Group
Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in
Zillow Group's affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Zillow Rentals®, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce® and Follow Up Boss®.
All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2024 MFTB Holdco, Inc., a Zillow affiliate.
1 The Zillow® market report is a monthly overview of the national and local real estate markets. The report is compiled by Zillow Research. For more information, visit www.zillow.com/research.
2 The "typical home" in this scenario is a home priced at the national Zillow Home Value Index value in the month noted. A household is considered able to afford a home at that price if the estimated monthly mortgage payment on that home would cost no more than
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SOURCE Zillow
FAQ
What was the typical U.S. home value in September 2024 according to Zillow (ZG)?
How did mortgage rates affect buying power in September 2024 for Zillow (ZG) users?
Which regions are experiencing buyers markets according to Zillow's (ZG) September 2024 report?
What was the year-over-year change in home values reported by Zillow (ZG) in September 2024?
