By Paulina Cachero
US home sales plummeted at a record rate in November as high mortgage rates crippled demand.
Purchases dropped 35% year-over-year, according to a recent report from Redfin, marking the largest decline since the real estate brokerage started collecting data in 2012.
A separate report found sales that of previously owned homes fell for a 10th-straight month in November — the longest string of declines dating back to 1999.
The Federal Reserve’s attempts to tamp down inflation this year have brought the housing market to a screeching halt, with high borrowing costs sidelining potential buyers. It’s a drastic shift from the buying frenzy early in the pandemic that prompted bidding wars and drove home values though the roof.
The cooldown has spooked sellers, who are slashing prices or taking homes off the market. The median US home-sale price rose just 2.6% from a year earlier, the smallest increase since May 2020, according to Redfin. New listings also fell 28% year-over-year, the largest drop on record aside from April 2020.
But there are some signs of a relief, with mortgages rates recently falling for the sixth straight week. Fewer home-purchase agreements were cancelled in November, and mortgage rates are expected to continue their downward trend into 2023, the Redfin report said.
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