Mortgage Rate Dip Brings Buyers and Sellers Back (September 2024 Market Report)
Lower mortgage rates brought both buyers and sellers back to the market in September, proving their readiness to return when conditions are right. New listings and sales both moved closer to pre-pandemic norms.
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 6.08% in late September meant a boost of more than $40,000 in buying power over the past four months. That helps more buyers clear the affordability hurdle, and means buyers already in the market are able to access more homes.
While the mortgage rate spike after a strong jobs report early in October gave back some of those affordability gains, at least for now, we tend to see the greatest share of listings with a price cut at this time of year as sellers make last-ditch efforts to attract buyers ahead of the holiday season.
Buyers markets are spreading across the Southeast
The return of sellers to the market appeared stronger than that of buyers, continuing to lift the pool of active inventory and ease competitive pressure slightly over September. While the housing market nationwide remains neutral, according to Zillow’s market heat index, Atlanta joined a growing list of large Southern metro areas that have tipped in favor of buyers. Ten of the 50 biggest metros are now considered buyers markets, all in Florida, Georgia, Texas, Tennessee or Louisiana.
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 continue to be much more locked in. That relative lack of options makes the market feel more competitive for buyers in those areas. More plentiful new construction, cash purchases, and free-and-clear owners in the South play a role in unlocking more inventory, as well.
Home values
- The typical U.S. home value is $360,999.
- The typical monthly mortgage payment, assuming 20% down, is $1,760.
- Home values climbed month over month in only two of the 50 largest metro areas in September: the New York City metro area (0.3%) and Providence (0.1%).
- Home values fell, on a monthly basis, in 44 major metro areas. The largest monthly drops were in San Francisco (-1.1%), San Jose (-0.9%), New Orleans (-0.8%), Austin (-0.8%), and Tampa (-0.7%).
- Home values are up from year-ago levels in 43 of the 50 largest metro areas. Annual gains are highest in San Jose (7.8%), Hartford (7.6%), New York (7.1%), Providence (7%), and Buffalo (5.9%).
- Home values are down from year-ago levels in seven major metro areas. The largest drops were in New Orleans (-4%), Austin (-4%), San Antonio (-2.7%), Birmingham (-0.7%), and Tampa (-0.5%).
- The typical mortgage payment is down 7.5% from last year and has increased by 97.3% since pre-pandemic.
Inventory and new listings
- New listings decreased by 8.3% month over month in September.
- New listings decreased by 1.2% compared to last year.
- New listings are 17% lower than pre-pandemic levels.
- Total inventory (the number of listings active at any time during the month) in September decreased by 0.2% from the previous month.
- There were 21.6% more listings active in September compared to last year.
- Inventory levels are 29.1% lower than pre-pandemic levels for the month.
Price cuts and share sold above list
- 25.1% of listings in September had a price cut. That is down 0.8 percentage points (ppts) month over month.
- There are 1.2ppts more listings with a price cut compared to last year.
- 30.5% of homes sold above their list price last month. That is down 2.8ppts month over month.
- 6.2ppts fewer homes sold above their list price compared to last year.
Newly pending sales
- Newly pending listings decreased by 7.3% in September from the prior month.
- Newly pending listings increased by 3.5% from last year.
- Median days to pending, the typical time since initial list date for homes that went under contract in a month, is at 21 days in September, up one day since last month.
- Median days to pending increased by six days from last year.
Market heat index
- Zillow’s market heat index shows the nation is currently a neutral market.
- The strongest sellers markets are San Jose, Buffalo, Hartford, Boston, and New York.
- The strongest buyers markets are New Orleans, Miami, Jacksonville, Austin, and Tampa.
