October 4, 2024
- The Realtor.com® economics team video update gives you the relevant economic and real estate information you need to know each week every Friday to navigate the housing market as a homebuyer, home seller, or industry professional.
- For the week ending Friday October 4, Chief Economist Danielle Hale highlights key economic updates in the labor market. The unemployment rate was 4.2% and employers added a net 165K jobs to payrolls. Importantly, earnings continued to rise faster than inflation, meaning workers saw a real increase in spending power. A separate report showed that although job openings increased slightly, job quits dropped–a sign that workers may be less confident in the jobs market despite the healthy topline.
- Mortgage rates ticked higher in the week. But even after the step up, rates remain very close to 2-year lows for a 3rd straight week. This has started to revive buying activity with purchase applications for mortgages up from a year ago for a 2nd week after a 3.5-year streak of declines. Purchase activity remains low, but the 9% gain was a sizable step in the right direction.
- Homeowners have other news to celebrate. According to Realtor.com economist Jiayi Xu, the value of household real estate hit a new high, helping to push the average per-homeowner equity to $267,000. While equity creates options for homeowners, it deepens the divide between those who own and those who still only aspire to.
- Low existing mortgage rates help homeowners build equity fast, but this advantage has many feeling locked in place by “golden handcuffs.” In fact, Realtor.com economist Hannah Jones found that more than 4 in 5 homeowners with a mortgage have a rate below 6%, likely hampering their desire to move because it would mean replacing their low rate with a higher one, raising monthly costs.
- But there are signs that falling mortgage rates are loosening the lock-in effect. In September, Realtor.com economist Ralph McLaughlin noted an 11.6% jump in the number of newly listed homes on the market with a stronger uptick in higher-priced markets. The median home price eased 1% compared to last year, but the price per square foot rose, suggesting that a larger number of low-priced homes is contributing to the drop in the median. Importantly, time on market rose by a week, making this the slowest September in 5 years.
- There is significant variation in time on market from city to city and even neighborhood to neighborhood. This variation is one of many things that can be explored with new dynamic maps from Realtor.com that let you map the big picture and zoom in for the details on the metrics that matter to you.
- And finally, as the national best time to buy fades somewhat into the rearview, it’s worth noting that this week and next are the next most favorable for shoppers nationwide. Plus, NEXT WEEK is the best week in Atlanta, GA; Las Vegas, NV; Columbus, OH; Indianapolis, IN; New Orleans, LA; and Rochester, NY.
- You’ll find all the details including full reports and our housing data for download at realtor.com/research. You can also follow us on X (formerly twitter) for real time updates. And now instagram @realtordotcomecon for graphics.
VIDEO TRANSCRIPT:
- I’m Danielle Hale, Chief Economist at Realtor.com®. And here’s what you need to know about the economy and housing market this week!
- The key economic update is on the labor market. The unemployment rate dropped to 4.1% and employers added a net 254,000 jobs to payrolls. Importantly, earnings continued to rise faster than inflation, meaning workers saw a real increase in spending power.
- A separate report showed that although job openings increased slightly, job quits dropped–a sign that workers may be less confident in the jobs market despite the healthy topline.
- In financial markets, mortgage rates ticked higher in the week. Even after the step up, mortgage rates remain very close to 2-year lows for a 3rd straight week.
- This has started to revive buying activity with purchase applications for mortgages up from a year ago for a 2nd week after a 3.5 year streak of declines. Purchase activity remains low, but the 9% gain was a sizable step in the right direction.
- Homeowners have other news to celebrate. The value of household real estate hit a new high, helping to push the average per-homeowner equity to $267,000. While equity creates options for homeowners, it deepens the divide between those who own and those who still only aspire to.
- Low existing mortgage rates help homeowners build equity fast, but this advantage has many feeling locked in place by ‘golden handcuffs.’ In fact, more than 4 in 5 homeowners with a mortgage have a rate below 6%, likely hampering their desire to move because it would mean replacing their low rate with a higher one, raising monthly costs.
- But there are signs that falling mortgage rates are loosening the lock-in effect. In September, Realtor.com saw an 11.6% jump in the number of newly listed homes on the market with a stronger uptick in higher-priced markets. The median home price eased 1% compared to last year, but the price per square foot rose, suggesting that a larger number of low-priced homes is contributing to the drop in the median. Importantly, time on market rose by a week, making this the slowest September in 5 years.
- There is significant variation in time on market from city to city and even neighborhood to neighborhood. This variation is one of many that can be explored with new dynamic maps from Realtor.com that let you map the big picture and zoom in for the details on the metrics that matter to you.
- And finally, as the national best time to buy fades somewhat into the rearview, it’s worth noting that this week and next are the next most favorable for shoppers nationwide. Plus, NEXT WEEK is the best week in Atlanta, GA; Las Vegas, NV; Columbus, OH; Indianapolis, IN; New Orleans, LA; and Rochester, NY.
- You’ll find all the details including full reports and our housing data for download at realtor.com/research. You can also follow us on X (formerly twitter) for real time updates. And now instagram @realtordotcomecon for graphics.
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