Home sales surge at fastest pace in 3+ years

A post-election spike in home sales appeared after the recent election, giving weight to some theories that buyers would hold off until they received clarity on the political situation in the U.S.

Pending home sales continued their momentum by accelerating 12.1% on an annual basis for the four-week period ending Nov. 24, according to Redfin's data. The increase was the largest jump since May 2021 and occurred despite steadily rising rates over much of the month.

While the latest numbers might seem encouraging for real estate and mortgage businesses in search of a boost, the online broker also cautioned that data between 2023 and 2024 periods were not entirely comparable, with Thanksgiving coming one week earlier last year. 

Still, the latest rise follows a 4.5% increase at the end of October for a similar preceding four-week period as mortgage rates noticeably declined, providing late-year tailwinds for lenders. 

The data also demonstrated that there's still robust housing demand in spite of ongoing fits and starts in rates and affordability. 

"I think the demand for housing pretty much across the board — whether you're talking about entry level, all the way up to move-up housing and luxury — stayed very strong all year," said Jay McCanless, senior vice president, equity research at Wedbush, in a recent interview. 

Among recent buyers are many on solid financial footing who can take advantage of the rapid growth in home equity accrued this decade, he said. 

"They're not completely rate insensitive, but they're certainly more rate insensitive than the average first-time buyer out there."

Redfin's homebuyer demand index, a measure of home tour and buying services requested by consumers on its platform, gave an early indication of likely positive numbers in November. By mid-month the index finished at its highest since the first half of 2023. Numbers dropped off in the week preceding Thanksgiving but were still up by approximately 7% year over year.

The elevated consumer interest also supported research from lenders over the summer that showed a number of prospective home buyers were opting to wait until the end of election season to move forward. 

"We didn't think that the election itself was going to be that big of a headwind psychologically, but it almost seemed like it was for certain buyers," McCanless said.

Some potential new homeowners may have also wanted to wait until after a second interest rate cut came from the Federal Reserve, Redfin noted last month.  

A quarter of homes for sale sold above their listing price during the November four-week period compared to 27% one year prior. The median asking price came in at $385,975, up 5.4% from 12 months earlier. 

The median sale price finished higher than the asking number by 0.2% at $386,625. The sales price surged 7% from a year ago and was the largest annual hike since September 2022. 

Housing costs increased, even as new market inventory saw a double-digit annual uptick over much of November in comparison to the holiday-shortened 2023 period. New listings rose by over 74,000 units, or 10.6%, Redfin said. Approximately 3.9 months of supply is currently available. Four to five months supply is typically an indicator of a balanced market.