U.S. Mortgage Payments Up 20% from 2022; Inventory Down 19%

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According to Redfin, the typical homebuyer’s monthly mortgage payment is up 19% compared to a year ago.  Housing payments remain historically high because mortgage rates remain elevated and home prices continue to rise.  However, the renewed rise in prices is not due to the increase in mortgage rates but mainly due to the ongoing lack of supply.  The biggest drop in inventory in 18 months was seen as homeowners hold on to low rates.  Redfin said, “Home prices are increasing because of the mismatch between supply and demand. High mortgage rates have pushed many would-be sellers out of the market, with homeowners hanging onto their relatively low rates. The total number of homes for sale is down 19%, the biggest drop in a year and a half, and new listings are down 21%.”  Notably, high rates are sidelining potential buyers but not as much as they are deterring would-be sellers who presently have lower rates.