Redfin: 12 Straight Months of Double-Digit Home Price Increases

(Chart courtesy Redfin, Seattle.)

Redfin, Seattle, said the median price of homes sold in July jumped by nearly 20% from a year earlier to a record high $385,600, down from a peak of 26% in May but still higher than any point on record prior to April of this year.

Redfin said July marked the 12th consecutive month of double-digit price gains. Redfin Chief Economist Daryl Fairweather said this is significant because a year ago the housing market was already in a strong growth phase, after pausing briefly at the onset of the pandemic.

“Home prices are still soaring at an astonishing rate,” Fairweather said. “Now that we’re a year out from the post-lockdown rebound, we can no longer explain away the enormous price growth by pointing to the pandemic’s earliest impacts on the housing market. While this ongoing trend continues to fuel an already severe affordability crisis, the market is becoming somewhat less competitive for homebuyers. Demand has softened enough that homes aren’t flying off the market quite as fast or for as much above list price as they were in the spring. Mortgage rates are remaining about as low as they’ve ever been, so buyers who lose out in a bidding war don’t have to fear that they’ve missed their window to buy. As more homes are being listed, it may be worth waiting for the right home at the right price.”

The report said median sale prices increased from a year earlier in all of the 85 largest metro areas Redfin tracks. The largest price increase was in Austin, Texas (39%), followed by Phoenix (28%) and Salt Lake City (26%). Smallest price increases were posted in New Orleans (5%), Omaha, Neb. (5%) and Virginia Beach, Va. (6%).

The report said the typical home that sold in July went under contract in 15 days—less than half as much time as a year earlier, when homes sold in a median 35 days—but up one day from June.

In a separate report, Redfin said the share of homes with price drops has now passed the 5% mark, the highest level this measure has reached since late 2019 and still climbing during a time of the year that is usually relatively flat.

“The housing market is less hectic than it was in early spring, but it’s still far from typical. The move to a less imbalanced market is happening slowly,” Fairweather said. “As we approach the beginning of back-to-school season, home prices typically cool, supply winds down and homes take longer to sell. All that’s happening, just very slowly.”