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Seattle’s housing market is cooling faster than any other major metro in the United States, but Denver isn’t too far behind, according to real estate firm Redfin.
Metro Denver tied for fifth with Sacramento, Calif., in terms of how quickly its housing market slowed down between February and August. After Seattle, Las Vegas; San Jose, Calif.; and San Diego are the markets deaccelerating the fastest.
Redfin researchers looked at year-over-year changes in sales price, price drops by sellers, total inventory, pending sales, as well as the changes in the share of sales-to-list price and the share of homes that went off the market in two weeks to determine how quickly markets were cooling in the 100 largest U.S. metro areas.
“These are all places where homebuyers are feeling the sting of rising home prices, higher mortgage rates and inflation very sharply. They’re slowing down partly because so many people have been priced out and partly because last year’s record-low rates made them unsustainably hot,” said Redfin Chief Economist Daryl Fairweather in the report.
Not surprisingly, many of the fastest cooling markets are also among the most expensive in terms of the median price of a home sold. Denver ranked 14th on that measure nationally out of the 100 largest metros at $545,000. It is the most expensive housing market in the country not in a coastal area.
Housing markets could face even more pressure after rates on 30-year mortgages reached 6.29% this week.
Although some agents are making the argument that the market is returning to “normal” after months of pandemic excess, Redfin counters that conditions now are anything but normal.
Normally, in a slowing market supply increases and prices level off or start to fall. But many current homeowners are sitting on mortgage rates at half or less current rates, reducing their incentive to move unless they absolutely have to. In a sign of just how abnormal this market is, home sales prices have picked up in recent weeks despite falling demand.
“There has been a lot of talk of a ‘new normal,’ but what’s happening in the housing market feels more like a ‘new weird,’ ” Redfin Deputy Chief Economist Taylor Marr commented Thursday.
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