The Chief Executive Office of real estate brokerage Redfin took it as a positive development the cooling off in the recently blazing hot housing market.
Glenn Kelman told in CNBC’s Closing Bell that the slowing down may be good for the overheated market.
“For the past couple of weeks, housing has been hot instead of blazing hot, and it’s actually probably good for the market. We’ve been running too hot for too long,” Kelman said.
“Sometimes you’ll hear an agent say, ‘Well, we only got five or 10 offers on this property instead of 15 or 20,’ so I still think we’ll be supply constrained. There are more buyers than sellers,” he added saying to CNBC.
Redfin noted the four-week decline in pending sales and a drop in its demand index, down 12% from its March peak.
“While the market has not come to a full stop, we are seeing signs of yielding,” Westchester County, NY Redfin real estate agent Candice Smith said.
Mortgage application volume decreases
In a recent index update, the Mortgage Bankers Association also pointed out a decreased of 3.1% on mortgage application volume despite the slight fell of mortgage rates.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 3.15% from 3.17% for loans with a 20% down payment.
“With fewer homeowners able to take advantage of lower rates, the refinance share dipped to the lowest level since April,” Joel Kan, MBA’s associate vice president of economic and industry forecasting has said.
It was noted that the applications for a mortgage to purchase a home were basically flat from the previous week and 24% lower than a year ago. Moreover, fewer buyers can afford a home due to high prices.