More than 1 in 3 homesellers working with Coldwell Banker-affiliated agents hold mortgage rates below 5 percent and are still planning to list this spring, a sign the rate lock-in effect that has constrained housing supply for years may be easing, according to a new report from Coldwell Banker Real Estate.
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The findings come from a survey of 727 Coldwell Banker-affiliated agents conducted between March 23 and April 6. About 43 percent of those agents reported that this spring’s home shopping season is busier than last year.
Still, the lock-in effect has not disappeared. Some 61 percent of agents said it remains a major or moderate factor in seller decision-making, while 39 percent said it is not a meaningful factor or is only a minor one.
Jason Waugh
“Working through the lock-in effect will take time,” said Jason Waugh, president of Coldwell Banker Affiliates. “But we are starting to see early signs that it is loosening, particularly in the Midwest and in the West, which could have a meaningful impact on inventory.”
The survey identified personal life circumstances, rather than market timing, as the primary driver behind listings, with 36 percent of agents citing that as the main reason clients are selling.
Separate data from Redfin supports the early-spring momentum. New listings rose 3 percent year over year during the four weeks ending April 19, the biggest increase since November, while mortgage-purchase applications climbed 10 percent week over week, Redfin reported.
The weekly average 30-year fixed mortgage rate fell to 6.3 percent as of the week ending April 16, down from a six-month high two weeks earlier, per Freddie Mac data cited by Redfin.
Even so, Redfin described the season as off to a slow start. Pending home sales fell 1.2 percent year over year for the same period, and the median sale price rose 2 percent to $394,687.
The Coldwell Banker report also flagged a deepening regional divide. Some 70 percent of agents in the Midwest and 74 percent in the Northeast characterized their markets as sellers’ markets, compared to 13 percent in the South and 22 percent in the West. About half of agents in the South (56 percent) and West (46 percent) described their markets as buyers’ markets.
“Comeback buyers,” those who paused their home search within the past two years before re-entering the market, account for about 20 percent of current homebuyers working with Coldwell Banker-affiliated agents, per the survey. About 75 percent of agents working with these buyers said they returned with roughly the same budget.
