30-Year Mortgage Rates Hit 8.0%

California Home Sales Down 21.5% YoY in September

Mortgage News Daily reports 30-year fixed rate mortgages rose to 8.0% today (for top tier scenarios).

This will mostly impact closed sales in November and December, and strongly suggests we will see new cycle lows for existing home sales over the winter.

Note: The National Association of Realtors (NAR) is scheduled to release September existing home sales tomorrow, Thursday, October 19th, at 10:00 AM ET. The consensus is the NAR will report sales of 3.94 million SAAR, down from 4.04 million in August.

Housing economist Tom Lawler expects the NAR to report sales of 4.00 million SAAR for September.

Due to the impact of Hurricane Ian in September 2022, existing home sales are up year-over-year in Florida, and that might have kept seasonally adjusted sales from hitting a new cycle low in September (it will be close).

California Home Sales Down 21.5% YoY in September

California doesn’t report monthly inventory numbers, but they do report sales and the change in months of inventory.

From the California Association of Realtors® (C.A.R.): California home prices hold steady as high interest rates continue to test housing market, C.A.R. reports

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 240,940 in September, according to information collected by C.A.R. from more than 90 local REALTOR^® associations and MLSs statewide. The statewide annualized sales figure represents what would be the total number of homes sold during 2023 if sales maintained the September pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

September’s sales pace was down 5.4 percent on a monthly basis from 254,740 in August and down 21.5 percent from a year ago, when a revised 307,000 homes were sold on an annualized basis. Sales of existing single-family homes in California remained below the 300,000-unit pace for the 12th month in a row. The monthly decline was the fourth consecutive decrease, and the annual decline was the 27^th straight drop.

With the market being less competitive, there are greater opportunities for consumers who need to purchase a home for personal reasons or those who can qualify to purchase at today’s interest rates,” said C.A.R. President Jennifer Branchini, a Bay Area REALTOR^®.

“More sellers are making concessions as homes are taking longer to sell, fewer homes are selling above asking price, and there are more homes to choose from.” …

• Active listings at the state level continued to dip on a year-over year basis for five straight months, with the decline in each of the last six months all registering more than 20 percent year-over-year. With rates remaining high and the market transitioning to the low season, active listings will not likely improve much, if at all, before the end of the year.

emphasis added

4th Look at Local Housing Markets in September