National Data

Home Price Gains Slow as Mortgage Rates Rise

By Mike Simonsen on February 19, 2024


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Mike Simonsen

Mike Simonsen is the founder and president of real estate analytics firm Altos Research, which has provided national and local real estate data to financial institutions, real estate professionals, and investors across the country for more than 15 years. An expert trendspotter, Mike uses Altos data to identify market shifts months before they hit the headlines.

Are last year’s surprising home price gains evaporating now? As interest rates climb again, some of the price signals are softening. Inventory is climbing vs. last year, and home prices have stayed flat for three weeks now. The price reductions data has turned less bullish for future sales also. 

Mortgage rates are back over 7%. We can see the impact on home buyer demand across several of our stats. And as demand slows, inventory grows. Inventory is up over last year and is about to turn the corner and start climbing for the spring selling season. Probably within a couple weeks.

Every week Altos Research tracks every home for sale in the country. We analyze all the pricing, supply and demand, and all the changes in that data and we make it available to you before you see it in the traditional channels. If you aren’t using Altos market reports with your clients, your buyers and sellers, now might be the time to step up. Go to and book a free consult with our team. Because everyone is worried about what’s happening right now. They need you to help them see clearly. The data we cover here in these national videos is available for every zip code in the US. Join us to dive in.

I’m Mike Simonsen, I’m the founder of Altos Research. Let’s look at the data for the week of February 19, 2024. Please refer to the video below for all the charts I mention in this transcript!


New Listings


New listings continue to show us that more sellers are interested in this market this year.  With just under 50,000 new listings unsold coming to the market this week, that’s now 16% more than the same week a year ago. Each week, the percentage gains over a year ago keep improving.  More sellers each week. I’ll continue to point out this still isn’t a lot of sellers. Its improvement over 2023’s barren desert of home sellers. 

In this chart each line is a year. The gray lines are years past. The light red line is last year, which was ultra low all year long. Very few sellers in 2023. See at the left end of the chart the dark red line is this year’s curve underway. And it keeps growing compared to a year ago. More listings are adding to active inventory. 

You can interpret this two ways: For me this is an encouraging trend for home buyers. It implies more selection and implies that more sales will get done in 2024 than last year.

For the housing market bears out there, any rising inventory is a red flag for the market to crash. There are some markets where inventory is no longer at the crisis shortage levels of the pandemic. Is it too much inventory? Is new supply growing out of balance with demand? It’s worth keeping an eye on. 


As a result of sellers easing back in, and lower demand from expensive money, there are now 494,000 single family homes on the market across the US. That’s basically flat from last week - just a fraction of a percent fewer homes on the market now than last week. 1 or 2 basis points. But the key is there is now 13% more active inventory than last year at this time. Each week we have more sellers and each week that inventory spread over last year keeps growing. Inventory fell nationally this week but is up compared to a year ago. Last year inventory fell by 1.5% in the mid-February week. This year it just inched lower. So the spread grew. This is the same trend we’ve been talking about for several months.

See the dark red line here. Last week was 12% inventory growth over 2023, now it’s 13%. Available inventory of unsold homes on the market will continue to grow. This trend looks durable. We’ve been talking about new sellers emerging to add to inventory, but also as mortgage rates rise, demand slows. As demand slows, inventory grows. 

This chart helps us see the bigger picture too. Inventory has been incredibly restricted for several years. Each year with higher mortgage rates, inventory will continue to build. But we’re coming off such low levels that we’re nowhere near normal levels of homes on the market. Nationally the number of available homes to buy is still quite low.  

Regionally the Gulf States are where inventory is rising the most quickly. Southwest Florida, over to New Orleans and into Texas. Inventory is back at 2019 levels in many of these markets. Our Altos Market Action Index gauge has some of them in Buyer’s Opportunity for the first time in many years with inventory sufficiently high relative to demand. On the other hand California in fact most of the West and much of the Northeast still has less inventory than last year, but pretty much the whole country is rising. Again, since no market has a lot of homes for sale, I interpret more supply as a mostly positive trend for the year. 

New Pendings

As inventory grows and new sellers grow, it was an encouraging week for new contracts too. This week saw 60,000 new contracts started for single family home purchases. That’s 9% more than the same week a year ago. If we can sustain 9% more sales over 2023, that will be excellent growth, but I’m no longer so sanguine that this is going to be easy.  Last week was 3% sales growth over the previous year. This week is 9% growth. That rate will probably dip back down next week. The key here is that more sellers should mean more sales this year. The question is how many more sales.

The bearish scenario that we watch for is if inventory rises but sales do not. And we can see that when mortgage rates spike, sales take a hit very quickly. The economy has been very strong, stronger than expected, so interest rates have stayed higher for longer. Higher mortgage rates have resulted in fewer new contracts than I expected, say 6 weeks ago. Though this week was an encouraging return to growth with 9% home sales gains over 2023, this is something to keep our eyes on. If inventory rises but we do not see the corresponding growth in sales that would have us revising lower all the forecasts for 2024.

In this chart we’re tracking the new contracts pending for home purchases each week. You can see this year compared to each of the last couple years. These are the homes that went into contract in a given week. Offers made and the sales process is underway. For sales growth, we want to see the dark line climbing and separating from the red line of 2023. We show 2022 on this chart also that’s the pink line. At that time it was the end of the pandemic boom, the end of 3% mortgages and there was a lot of urgency to get deals done before the cost of money spiraled up. It seems unlikely that we’ll eclipse the 2022 pace of sales until the latter half of the year. If we’re lucky and mortgage rates are in the mid-to-low 6s by July then we should see those gains at that time. If we’re unlucky, mortgage rates jump again and consumers will stop buying homes.


Price Reductions

We can really see how sensitive home buyers are to higher mortgage rates when we look at the price reductions data. As of mid-February, 30% of the homes on the market have taken a price cut. This is in the normal range for this time of year.  

But price reductions didn’t decline this week, which they often do in mid-February. That’s because mortgage rates have jumped over 7% again. When rates jump, a few offers don’t get made and a few more sellers cut their prices. 

In strong housing market years, this part of February has declining price reductions each week. If you’re getting fresh inventory and you’re getting offers quickly, then each week fewer sellers have price cuts. And in this chart you can see many years where price cuts are falling quickly in the middle of February. But this week we’re flat because mortgage rates are back over 7%. At the left end of the chart see last year’s bright red line was still declining. That told us that home prices had upward pressure a year ago. At the time, very few sellers were met with increasing demand as mortgage rates were close to 6%. Now, with mortgage rates over 7%, we have less upward price pressures. This is a big change in the pattern from a year ago and from just a month ago. 

Price reductions are a leading indicator for future sales prices. A home is on the market now, it doesn’t get any offers, does a price cut, gets an offer in March, closes in April. So this data lets us see several months into the future. 

And what it’s telling us is that consumers are taking their time, bidding less aggressively or not at all as mortgage rates are higher. Now that’ll change quickly if we get lucky and rates fall. 


Home Prices


Median price for single family homes on the market is unchanged this week at $425,000. It’s not uncommon for home prices to cluster around the big round numbers and we’ve been at this level for 3 weeks now. I expect the median price for homes to tick up in the next couple weeks. 

It’s worth noting that while we finished December with pretty strong price gains over the year prior, those gains seem to be compressing now. In the active market data here, home prices are just 1-2% higher than last year at this time. Mortgage rates have been climbing since the new year, so maybe that shouldn’t be surprising. Worth watching. Will home price gains evaporate if mortgage rates stay in the 7s? 

The price of the newly listed cohort is 1.8% higher than the same week a year ago. The bright red line on this chart has more noise than the overall market, it jumps around a bit, but it should generally climb in the spring. The steepness of this red line tells us a lot about organic levels of demand out there. And right now that demand is a little muted. The median price of the newly listed single family homes is $399,900, which is also unchanged from last week. Will be very interesting to see if this resumes its climb in the next few weeks or if higher mortgage rates have taken the wind from the sails. 

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See you next week!

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