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Yahoo
11-06-2025
- Business
- Yahoo
'Market Crashing Before Our Eyes': Buyers Are Backing Out Of Deals In Record Numbers Amid Relentlessly High Interest Rates
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Power up the flux capacitor, climb aboard your DeLorean and prepare to travel back to 2008 because recent headlines concerning a real estate market crash seem very familiar. The main differences between today's imploding market and that of 17 years ago were that in '08, bad mortgages and over-inflated house prices were the issue. Today, high interest rates, soaring insurance costs, economic fears, and stubborn inflation are the primary problems. The results, however, are pretty similar — much of the U.S. is becoming a buyer's market, according to a recent report by Redfin (NASDAQ:RDFN). Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – The numbers are shocking. In April, 56,000 home purchase contracts were canceled — just over 14% of all pending transactions, Redfin reports. Not since the early days of the pandemic have so many deals failed to get to the finish line. 'We see a lot of deals collapsing, especially in major markets like Las Vegas and Phoenix,' Joel Efosa, the CEO of Fire Cash Buyer, told the Daily Mail.' It's especially first-time buyers. Some are losing their jobs, others simply no longer qualify for loans because they don't make enough or have good credit.' He noted: 'Realtors are asking sellers to accept the truth — the market is crashing before our eyes.' Prices have fallen year-over-year from April to the same time last year in 20 major metro areas, Zillow's Home Value Index shows. Most of the declines have occurred in Sunbelt states, such as Arizona, Texas, Florida, and Louisiana, which have followed a similar pattern to 2008. Trending: This Jeff Bezos-backed startup will allow you to . However, Zillow reports that the Northeast has yet to tip into a buyer's market, where sellers still have the upper hand in cities like Buffalo, New York; Boston; Hartford, Connecticut; and Providence, Rhode Island. In these markets, there are at least 10 engaged home shoppers for every listed home. The ongoing discussion of tariffs and increasing concerns about higher prices for food, furniture, construction, cars, and more are keeping potential buyers on the sidelines. 'They're hearing the words' tariffs' and 'recession,' and it's making them nervous that if they buy now, the value of their home will decline, and they don't know whether mortgage rates will go up or down,' Desiree Bourgeois, a Redfin realtor in Detroit told the Daily Mail, 'There's a lot of uncertainty out there, with buyers trying to understand how their purchase would fit into their personal finances and the broader economic puzzle.'Florida has proven to be a bellwether state for the housing market. In 2008, the oversupply of homes, many of which were purchased by unqualified buyers with subprime mortgages, led to massive foreclosures. Now, a halt to inbound migration, coupled with extreme weather and soaring costs associated with insurance and homeowners' fees, has led to an abundance of homes sitting on the market. Current listings in Miami-Dade County, which includes one of the most expensive metro markets in Florida and the country, rose by over 42 percent in the first week of June compared top the same time last year, according to The MIAMI Association of Realtors. 'If these buildings are subject to reserve requirements, buyers want to make sure they're getting into a situation where the condos have their act together,' Brad O'Connor, chief economist at trade group Florida Realtors, told The Wall Street Journal. 'Whether it's the lenders or the buyers themselves, we've seen a slowdown in condo demands.' Read Next: With Point, you can , which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Image: Shutterstock This article 'Market Crashing Before Our Eyes': Buyers Are Backing Out Of Deals In Record Numbers Amid Relentlessly High Interest Rates originally appeared on Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
The Advertiser
10-06-2025
- Business
- The Advertiser
Rate cuts tipped to drive big price rises
Home prices are trending higher across Newcastle and Lake Macquarie, with property analysts expecting the region's dwelling value could rise up to 10 per cent by next year. Cotality's Home Value Index (HVI) report, released yesterday, revealed that the region's dwelling value (houses and units) increased 0.4 per cent in May. The median dwelling value is $939,456. Unit values experienced the most substantial growth over the month, up 0.6 per cent to hold a median value of $718,493. House prices lifted by 0.4 per cent in May, with a median value of $977,058. Cotality (formerly CoreLogic) head of research Tim Lawless thinks dwelling prices in the region could rise between 6 per cent and 10 per cent by late this year or early 2026. "If we look at the quarterly rate of growth at 1.4 per cent in Newcastle and Lake Macquarie and you do a simple extrapolation, you're looking at growth over the year at around 5.4 per cent," he said. "There is a good chance we will see growth conditions picking up from here, so I would think there could be growth of 6 per cent to 10 per cent for the year. "That's above what we saw a year ago, and it's about what we saw in 2023, but it's certainly not like what we saw during the pandemic. "If you look at the Newcastle region last year, it had growth of 5.1 per cent, so that is a pick up from a year ago, but it's nothing like we were seeing in 2021, where we saw housing value growth at 32 per cent year on year." Dwelling values in Newcastle and Lake Macquarie climbed 1.4 per cent over the quarter, with the prices strengthening after the Reserve Bank of Australia's (RBA) first rate cut in February. Last month, the RBA slashed the cash rate by a further 0.25 per cent to 3.85 per cent, and economists predict another two rate cuts this year. Lower interest rates and increased buyer activity are expected to keep property prices rising. "Interest rates tend to fuel housing demand through improved serviceability and greater borrowing capacity, and just as importantly, improved sentiment, which is really important for housing decision making," he said. "In the same sense, there are plenty of barriers to a significant level of growth ahead of us, and affordability is the main one." Data supplied by Cotality shows dwelling values in Newcastle and Lake Macquarie rose 4.5 per cent in the past 12 months. In the Hunter Valley (excluding Newcastle), dwelling values lifted 0.3 per cent in May and 4.8 per cent over 12 months. National dwelling values rose 0.5 per cent in May, taking the national index 1.7 per cent higher over the first five months of the year. The gains were broad-based, with every capital city posting a rise of at least 0.4 per cent through the month. "The continued momentum we're seeing across almost all markets is no doubt being fuelled by rate cuts - both those that have already happened, but also potential cuts in the coming months," he said. Home prices are trending higher across Newcastle and Lake Macquarie, with property analysts expecting the region's dwelling value could rise up to 10 per cent by next year. Cotality's Home Value Index (HVI) report, released yesterday, revealed that the region's dwelling value (houses and units) increased 0.4 per cent in May. The median dwelling value is $939,456. Unit values experienced the most substantial growth over the month, up 0.6 per cent to hold a median value of $718,493. House prices lifted by 0.4 per cent in May, with a median value of $977,058. Cotality (formerly CoreLogic) head of research Tim Lawless thinks dwelling prices in the region could rise between 6 per cent and 10 per cent by late this year or early 2026. "If we look at the quarterly rate of growth at 1.4 per cent in Newcastle and Lake Macquarie and you do a simple extrapolation, you're looking at growth over the year at around 5.4 per cent," he said. "There is a good chance we will see growth conditions picking up from here, so I would think there could be growth of 6 per cent to 10 per cent for the year. "That's above what we saw a year ago, and it's about what we saw in 2023, but it's certainly not like what we saw during the pandemic. "If you look at the Newcastle region last year, it had growth of 5.1 per cent, so that is a pick up from a year ago, but it's nothing like we were seeing in 2021, where we saw housing value growth at 32 per cent year on year." Dwelling values in Newcastle and Lake Macquarie climbed 1.4 per cent over the quarter, with the prices strengthening after the Reserve Bank of Australia's (RBA) first rate cut in February. Last month, the RBA slashed the cash rate by a further 0.25 per cent to 3.85 per cent, and economists predict another two rate cuts this year. Lower interest rates and increased buyer activity are expected to keep property prices rising. "Interest rates tend to fuel housing demand through improved serviceability and greater borrowing capacity, and just as importantly, improved sentiment, which is really important for housing decision making," he said. "In the same sense, there are plenty of barriers to a significant level of growth ahead of us, and affordability is the main one." Data supplied by Cotality shows dwelling values in Newcastle and Lake Macquarie rose 4.5 per cent in the past 12 months. In the Hunter Valley (excluding Newcastle), dwelling values lifted 0.3 per cent in May and 4.8 per cent over 12 months. National dwelling values rose 0.5 per cent in May, taking the national index 1.7 per cent higher over the first five months of the year. The gains were broad-based, with every capital city posting a rise of at least 0.4 per cent through the month. "The continued momentum we're seeing across almost all markets is no doubt being fuelled by rate cuts - both those that have already happened, but also potential cuts in the coming months," he said. Home prices are trending higher across Newcastle and Lake Macquarie, with property analysts expecting the region's dwelling value could rise up to 10 per cent by next year. Cotality's Home Value Index (HVI) report, released yesterday, revealed that the region's dwelling value (houses and units) increased 0.4 per cent in May. The median dwelling value is $939,456. Unit values experienced the most substantial growth over the month, up 0.6 per cent to hold a median value of $718,493. House prices lifted by 0.4 per cent in May, with a median value of $977,058. Cotality (formerly CoreLogic) head of research Tim Lawless thinks dwelling prices in the region could rise between 6 per cent and 10 per cent by late this year or early 2026. "If we look at the quarterly rate of growth at 1.4 per cent in Newcastle and Lake Macquarie and you do a simple extrapolation, you're looking at growth over the year at around 5.4 per cent," he said. "There is a good chance we will see growth conditions picking up from here, so I would think there could be growth of 6 per cent to 10 per cent for the year. "That's above what we saw a year ago, and it's about what we saw in 2023, but it's certainly not like what we saw during the pandemic. "If you look at the Newcastle region last year, it had growth of 5.1 per cent, so that is a pick up from a year ago, but it's nothing like we were seeing in 2021, where we saw housing value growth at 32 per cent year on year." Dwelling values in Newcastle and Lake Macquarie climbed 1.4 per cent over the quarter, with the prices strengthening after the Reserve Bank of Australia's (RBA) first rate cut in February. Last month, the RBA slashed the cash rate by a further 0.25 per cent to 3.85 per cent, and economists predict another two rate cuts this year. Lower interest rates and increased buyer activity are expected to keep property prices rising. "Interest rates tend to fuel housing demand through improved serviceability and greater borrowing capacity, and just as importantly, improved sentiment, which is really important for housing decision making," he said. "In the same sense, there are plenty of barriers to a significant level of growth ahead of us, and affordability is the main one." Data supplied by Cotality shows dwelling values in Newcastle and Lake Macquarie rose 4.5 per cent in the past 12 months. In the Hunter Valley (excluding Newcastle), dwelling values lifted 0.3 per cent in May and 4.8 per cent over 12 months. National dwelling values rose 0.5 per cent in May, taking the national index 1.7 per cent higher over the first five months of the year. The gains were broad-based, with every capital city posting a rise of at least 0.4 per cent through the month. "The continued momentum we're seeing across almost all markets is no doubt being fuelled by rate cuts - both those that have already happened, but also potential cuts in the coming months," he said. Home prices are trending higher across Newcastle and Lake Macquarie, with property analysts expecting the region's dwelling value could rise up to 10 per cent by next year. Cotality's Home Value Index (HVI) report, released yesterday, revealed that the region's dwelling value (houses and units) increased 0.4 per cent in May. The median dwelling value is $939,456. Unit values experienced the most substantial growth over the month, up 0.6 per cent to hold a median value of $718,493. House prices lifted by 0.4 per cent in May, with a median value of $977,058. Cotality (formerly CoreLogic) head of research Tim Lawless thinks dwelling prices in the region could rise between 6 per cent and 10 per cent by late this year or early 2026. "If we look at the quarterly rate of growth at 1.4 per cent in Newcastle and Lake Macquarie and you do a simple extrapolation, you're looking at growth over the year at around 5.4 per cent," he said. "There is a good chance we will see growth conditions picking up from here, so I would think there could be growth of 6 per cent to 10 per cent for the year. "That's above what we saw a year ago, and it's about what we saw in 2023, but it's certainly not like what we saw during the pandemic. "If you look at the Newcastle region last year, it had growth of 5.1 per cent, so that is a pick up from a year ago, but it's nothing like we were seeing in 2021, where we saw housing value growth at 32 per cent year on year." Dwelling values in Newcastle and Lake Macquarie climbed 1.4 per cent over the quarter, with the prices strengthening after the Reserve Bank of Australia's (RBA) first rate cut in February. Last month, the RBA slashed the cash rate by a further 0.25 per cent to 3.85 per cent, and economists predict another two rate cuts this year. Lower interest rates and increased buyer activity are expected to keep property prices rising. "Interest rates tend to fuel housing demand through improved serviceability and greater borrowing capacity, and just as importantly, improved sentiment, which is really important for housing decision making," he said. "In the same sense, there are plenty of barriers to a significant level of growth ahead of us, and affordability is the main one." Data supplied by Cotality shows dwelling values in Newcastle and Lake Macquarie rose 4.5 per cent in the past 12 months. In the Hunter Valley (excluding Newcastle), dwelling values lifted 0.3 per cent in May and 4.8 per cent over 12 months. National dwelling values rose 0.5 per cent in May, taking the national index 1.7 per cent higher over the first five months of the year. The gains were broad-based, with every capital city posting a rise of at least 0.4 per cent through the month. "The continued momentum we're seeing across almost all markets is no doubt being fuelled by rate cuts - both those that have already happened, but also potential cuts in the coming months," he said.
Sydney Morning Herald
02-06-2025
- Business
- Sydney Morning Herald
Property market records one of the quickest downturns ever
The latest property market downturn has become one of the shortest and shallowest on record, ending just three months after it started. Dwelling values took a hit between November 2024 and January 2025, falling 0.4 per cent nationally, latest data from Cotality (formerly CoreLogic) shows, after a series of interest rate hikes and cost-of-living pressures weighed on buyers' hip pockets. But in February, the month of the first interest rate cut in more than two years, the market started to turn around. The Reserve Bank cut the cash rate in February and May, to have it now sitting at 3.85 per cent. Cotality's Home Value Index for May showed dwelling values have jumped 1.7 per cent over the first five months of the year. Values in every capital city rose in May, by at least 0.4 per cent. Sydney values rose 0.5 per cent in May, Melbourne was up 0.4 per cent, Brisbane 0.6 per cent and Perth 0.7 per cent. Cotality research director Tim Lawless said the latest slowdown was more like a levelling-out of values, rather than an actual downturn, and was a lot less steep than the short downturns of 2020 and 2015. Dwelling values fell 1.8 per cent between April and June 2020 (the start of the COVID-19 pandemic), before skyrocketing on the back of cuts to the cash rate that ultimately reached rock bottom at 0.1 per cent. A similar, quick market turnaround also happened in 2015, when the Australian Prudential and Regulation Authority tightened lending criteria, particularly for property investors. Values fell 1.4 per cent in the December 2015 quarter. 'It really shows how much access to credit, or the ability to borrow money from the banks, can affect housing values,' Lawless said.
The Age
02-06-2025
- Business
- The Age
Property market records one of the quickest downturns ever
The latest property market downturn has become one of the shortest and shallowest on record, ending just three months after it started. Dwelling values took a hit between November 2024 and January 2025, falling 0.4 per cent nationally, latest data from Cotality (formerly CoreLogic) shows, after a series of interest rate hikes and cost-of-living pressures weighed on buyers' hip pockets. But in February, the month of the first interest rate cut in more than two years, the market started to turn around. The Reserve Bank cut the cash rate in February and May, to have it now sitting at 3.85 per cent. Cotality's Home Value Index for May showed dwelling values have jumped 1.7 per cent over the first five months of the year. Values in every capital city rose in May, by at least 0.4 per cent. Sydney values rose 0.5 per cent in May, Melbourne was up 0.4 per cent, Brisbane 0.6 per cent and Perth 0.7 per cent. Cotality research director Tim Lawless said the latest slowdown was more like a levelling-out of values, rather than an actual downturn, and was a lot less steep than the short downturns of 2020 and 2015. Dwelling values fell 1.8 per cent between April and June 2020 (the start of the COVID-19 pandemic), before skyrocketing on the back of cuts to the cash rate that ultimately reached rock bottom at 0.1 per cent. A similar, quick market turnaround also happened in 2015, when the Australian Prudential and Regulation Authority tightened lending criteria, particularly for property investors. Values fell 1.4 per cent in the December 2015 quarter. 'It really shows how much access to credit, or the ability to borrow money from the banks, can affect housing values,' Lawless said.
Business Times
01-06-2025
- Business
- Business Times
Australian house prices continue to climb after RBA rate cut
[SYDNEY] Australian home prices climbed for a fourth straight month, driven by a second interest rate cut by the country's central bank and expectations more will follow later this year. The Home Value Index advanced 0.5 per cent in May, with every major city recording a rise, property consultancy Cotality, formerly CoreLogic, said on Monday (Jun 2)). Darwin was the top gainer, climbing 1.6 per cent, followed by Perth which rose 0.7 per cent. The bellwether market of Sydney was up 0.5 per cent and Melbourne increased 0.4 per cent. 'The continued momentum we're seeing across almost all markets is no doubt being fuelled by rate cuts – both those that have already happened, but also potential cuts in the coming months,' said Tim Lawless, research director for Cotality. 'With interest rates falling again in May, we are likely to see a further positive influence flowing through to housing values in June and through the rest of the year.' Financial market pricing implies the Reserve Bank of Australia (RBA) will cut three more times this year to bring the cash rate to 3.1 per cent, from 3.85 per cent now. The national dwelling value was about eight times the household income at the end of last year, highlighting affordability constraints while home-loan serviceability was also at an all-time high, the Cotality data showed. A major factor supporting house price growth across the country is a chronic under-supply of homes. The newly re-elected government of Prime Minister Anthony Albanese has promised steps to address a once-in-a-generation housing crisis by building more homes and providing financial incentives to first-home buyers. While home prices gained in May, the monthly pace of rental growth eased to 0.4 per cent following three months of 0.6 per cent increases, according to Cotality. The largest capital markets of Sydney and Melbourne are among the softest, the data showed. The slowdown comes despite rental vacancy rates being below 2 per cent as affordability constraints and slowing migrations ease some of the demand pressure. 'Even if there are few vacant properties available for rent, it's hard to see how rental values can continue to record a strong rise off already high prices, especially with wage growth now slowing,' Cotality said. 'Larger households may be forming as a result, such as share homes and multi-generational living arrangements, taking some pressure off demand.' BLOOMBERG
