Zillow Reports Slower Home Sales and Rising Rents Amid High Mortgage Rates
Home sales in August fell slightly compared to the previous year, marking a slowdown from July's growth. According to Zillow’s Market Report, elevated mortgage rates above 6.5% have discouraged buyers, leading to fewer newly pending listings—a key indicator of future home closings—falling by nearly three percent annually. Despite an increase in inventory, new listings dropped sharply month-over-month as sellers adjusted prices downward more frequently than a year ago. The rental market is absorbing some demand that has shifted away from the for-sale segment, with rents rising 2.5% compared to last year—double the rate of home value growth. Zillow's chief economist noted that high mortgage rates are likely to keep many households on the sidelines until they ease, resulting in a soft end-of-year outlook for housing sales. Home values rose modestly by 1.3%, reaching $369,678 nationally, while monthly payments increased slightly due to higher interest costs and other expenses.
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Topics: Home sales Inventory levels Mortgage rates Rental market growth