Mortgage rates drop for a third consecutive week leading to rates that are at the lowest level since 2016. This has spurred a huge increase in refinance applications. Refinance applications with 20% down payments jumped 15% this week and 183% annually.
Purchasing applications dropped by 10% for the week but up 11% annually. The drop does not seem to be caused by low buyer demand but because of low supply. I foresee prices rising in the near future if supply of homes does not increase.
Active listings are at one of their lowest points across the MLS. 45,124 active listings in January 2020. In September 2018 we had 99,500 active listings (55% more than today) and last January we had 69,874 active listings (35% more than now).
Inventory Month Supply is also at its lowest point in the last 5 years across the MLS. January was at a 2.2 month supply vs September 2018 at 4.8 month supply.
How is this affecting our current local market? I have seen properties that have been sitting finally sell without dropping their prices. Now is the perfect time to list a property because there is very low competition. I’m predicting there will be an increase of properties over the next couple weeks but I think the demand will rise with low interest rates and relatively low supply to continue.