Redfin said low inventory has offset the effect of high consumer confidence and low interest rates on home sales
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Demand for housing remained steady from July to August as inventory remained limited, according to Redfin’s Housing Demand Index.
The index was 126 in July, remaining virtually flat from 127 in August. The index, which is adjusted for Redfin’s market share growth, rose 27.7% from the year-ago period.
“High consumer confidence and low interest rates have powered homebuyer demand, but too-low inventory has constrained home sales all year,” said Redfin Chief Economist Nela Richardson. “The Federal Reserve is now setting the stage for a slow, steady increase in mortgage rates in October by beginning to sell its mortgage portfolio. Fall buyers are likely to face slightly higher financing costs in addition to strong price growth.”
Redfin found a 0.8% seasonally adjusted decrease in the number of buyers requesting home tours from July to August, while the number of buyers writing offers increased 0.1% over the same period. On a year-over-year basis, the number of buyers requesting tours increased 42.3% and those who wrote offers increase 8.2%.
Oakland saw the biggest increase in the demand index among all metros covered by Redfin. The city’s index rose 29% from July to August and jumped 43% from the year-ago period. Oakland saw a 30% decrease in inventory from last year, while listings slipped 5.3%.
“August has traditionally been one of the slowest months in Oakland for homebuyer activity as people go on vacation and finish up their family activities before the kids head back to school,” Redfin Oakland agent Tom Hendershot said. “This year, August demand has really ramped up compared to July, and we expect September to be a very active month as long as more new inventory hits the market.”
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The index was 126 in July, remaining virtually flat from 127 in August. The index, which is adjusted for Redfin’s market share growth, rose 27.7% from the year-ago period.
“High consumer confidence and low interest rates have powered homebuyer demand, but too-low inventory has constrained home sales all year,” said Redfin Chief Economist Nela Richardson. “The Federal Reserve is now setting the stage for a slow, steady increase in mortgage rates in October by beginning to sell its mortgage portfolio. Fall buyers are likely to face slightly higher financing costs in addition to strong price growth.”
Redfin found a 0.8% seasonally adjusted decrease in the number of buyers requesting home tours from July to August, while the number of buyers writing offers increased 0.1% over the same period. On a year-over-year basis, the number of buyers requesting tours increased 42.3% and those who wrote offers increase 8.2%.
Oakland saw the biggest increase in the demand index among all metros covered by Redfin. The city’s index rose 29% from July to August and jumped 43% from the year-ago period. Oakland saw a 30% decrease in inventory from last year, while listings slipped 5.3%.
“August has traditionally been one of the slowest months in Oakland for homebuyer activity as people go on vacation and finish up their family activities before the kids head back to school,” Redfin Oakland agent Tom Hendershot said. “This year, August demand has really ramped up compared to July, and we expect September to be a very active month as long as more new inventory hits the market.”
Related stories:
Home prices still rising, bad news for first-timers
Redfin: Home prices surge, inventory plunges in August
