Rising Home Prices and Mortgage Rates Sidelining Cost-Conscious Buyers

Cost-conscious buyers are being pushed out of the market as mortgage rates and home prices both rise. Pending home sales dropped 4.1% year-over-year during the four weeks ending April 12, marking the largest decline in over a year. The median home-sale price rose 2.3% annually, the largest increase in a year. The average mortgage rate is 6.3% as of April 15, down from a 6.98% peak two weeks prior, but remains higher than it was in early March. Home-touring activity has increased only 11% since the start of the year, compared to a 40% increase in the same period last year. New listings of homes for sale declined 1.4% year-over-year. "Cost-conscious buyers are also jittery about the rising prices of other things—like gas, food and energy—cutting into their budgets," said Stacey Bryant, a Redfin Premier agent in Boston. The effect is most pronounced in local markets, with sales dropping 17.5% in Providence, RI, 16. satu 16.9% in Houston, and 14.8% in Nassau County, NY.