SEATTLE--(EON: Enhanced Online News)--The Redfin Housing Demand Index declined 3.5 percent to a seasonally-adjusted level of 100 in October, according to Redfin (www.redfin.com), the next-generation real estate brokerage.
“Some people are a little bit upset about mortgage rates increasing, but most are still pushing forward. Buyers feel the rates will only continue to rise, so they might as well try to buy now, especially before the frenetic spring market.”
A level of 100 represents the historical average for the three-year period from January 2013 to December 2015, meaning that current demand is at recent historical norms.
In October, the number of Redfin customers requesting home tours fell 3.7 percent from September, and the number of customers writing offers on homes fell 5.9 percent. Both of these measures posted double-digit increases in September.
One likely culprit is a shortage of homes to choose from, something that has put a damper on homebuyer enthusiasm month after month. Across the 15 metro areas tracked by the Demand Index, the number of homes listed in October was 9.5 percent lower than a year earlier. Those numbers dovetail with the shortages of homes reported in the most recent Redfin Real-Time Housing Market Tracker.
The Denver area in particular has had a lack of homes on the market. The number of homes for sale was down 22.3 percent compared to last year. Overall, the Redfin Demand Index in Denver was at a level of 102, down from 113 in September.
“There are still very few homes for sale in the Denver area,” said Redfin real estate agent Corey Keach. “But after a slow October, buyer interest has been picking up over the past week or two. Last year, I felt it in January, with people wanting to beat the busy spring season. My sense is that people are getting an even earlier jump this year. For homes priced below $400,000, we’re once again seeing multiple offers above the asking price. There simply aren’t enough homes to meet demand in that price range.”
Phoenix posted the largest month-over-month increase in demand, up 28 percent to 105 in October. Demand fell the most in San Diego, where the Demand Index dropped 21 percent to 87 in October.
Demand may be coming back up. In Chicago, where Redfin real estate agent Niko Voutsinas works, homebuyer demand was relatively tepid in October, at a Demand Index level of 91. He has seen activity pick up in the past couple weeks.
“Since the election, I’ve been extremely busy helping clients make offers and get under contract,” said Voutsinas. “Some people are a little bit upset about mortgage rates increasing, but most are still pushing forward. Buyers feel the rates will only continue to rise, so they might as well try to buy now, especially before the frenetic spring market.”
To read the full report, complete with charts, metro-level data and insights from local agents, please visit: https://www.redfin.com/blog/2016/11/housing-demand-cooled-in-october-dropping-to-a-three-year-average.html
About Redfin Corporation
Redfin (www.redfin.com) is the next-generation real estate brokerage, combining its own full-service agents with modern technology to redefine real estate in the consumer’s favor. Founded by software engineers, Redfin has the country's #1 brokerage website and offers a host of online tools to consumers, including the Redfin Estimate, the highly accurate automated home-value estimate. Homebuyers and sellers enjoy a full-service, technology-powered experience from Redfin real estate agents, while saving thousands in commissions. Redfin serves more than 80 major metro areas across the U.S. The company has closed more than $31 billion in home sales and saved customers more than $335 million in fees through 2015.
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