While the average rate on a 30-year fixed-rate mortgage fell to 6.95 percent last week, that number climbed back up to 7.08 percent for the week ending Nov. 10, according to Freddie Mac data.
If inflation refuses to budge, mortgage rates are more likely to climb rather than decline.
However, while rates are rising and eating away at affordability, at least another key indicator is falling, at least partially, to make up for it: home prices.
The median listing price for the average home peaked at $450,000 in June and has since fallen to $425,000 in October. And home prices are likely to continue their downward spiral through the holidays, though probably not as low as many homebuyers would like.
The typical asking price this year will be close to, but not likely to slip below $400,000 again, and the housing market is realigning, but slowly.
While home prices have been declining month over month, they are still higher than last year. For the week ending Nov. 10, home prices were up 11.7 percent compared to the same week last year.
This is the 45th consecutive week of double-digit increases, although the pace has at least abated, meaning that homebuyers may no longer have to contend with double-digit price increases.
If the recent slowdown continues, median listing price growth will be back in single-digit territory by the end of the year.
As home prices fall, many home sellers are hunkering down into deep hibernation.
For the week ending Nov. 10, new listings - or how many sellers listed their homes for sale - were down a staggering 20 percent compared to the same week last year. In fact, the number of homes listed for sale by owner has now fallen for 18 consecutive weeks.
This data suggests that many potential sellers may be joining buyers in a wait-and-see mode.
Sellers and buyers are sitting on the sidelines for the same reasons. Neither side is willing to deal with a volatile housing market.
However, while the number of new sellers entering the market has dropped sharply, the total number of homes for sale - which includes older listings that have been kicked around for months without buyers - is on the rise. In fact, for the week ending Nov. 10, inventory was up 42 percent over the same week last year.
And these stale listings are only getting staleer. in October, the median time homes stayed on the market was 51 days.
And in the week ending Nov. 10, homes stayed on the market a full week longer than they did in the same week last year. This marks 15 consecutive weeks of increasingly sluggish home sales.
Overall, it means homebuyers can now take more time to decide whether to make an offer. But they still aren't enjoying the lethargic pace of pre-pandemic 2020 homebuyers, who have 20 more days to make an offer than they do now.
In other words, the market has slowed relative to the peak buying season and relative to last fall, but homes are still selling relatively quickly compared to any other period.
