America’s Housing Market Shows Cracks As Foreclosures Rise And Buyers Retreat
America's housing market was showing growing signs of distress as home sales plunged toward decade-old lows, foreclosures climbed and soaring mortgage rates squeezed buyers and homeowners alike.
America’s housing market was showing growing signs of distress as home sales plunged toward decade-old lows, foreclosures climbed and soaring mortgage rates squeezed buyers and homeowners alike.
Pending home sales fell 4% in September, their steepest monthly decline in more than three years, as borrowing costs surged above 7%, according to a Redfin report released Monday. Meanwhile, foreclosure filings rose 13% from a year earlier in August, with completed bank repossessions jumping 42%, according to real estate data firm ATTOM, underscoring mounting pressure across a housing market already strained by years of elevated prices.
The September decline pushed pending sales to their lowest level since 2014, excluding the early months of the COVID-19 pandemic. Contract signings fell from a year earlier in all 50 major metropolitan areas tracked by Redfin, a nationwide pullback last seen in September 2023.
“The mood in the real estate industry has significantly shifted,” Redfin Chief Economist Daryl Fairweather told Bloomberg. “When interest rates go up like this, fewer people can afford to buy homes, which means sales have to fall.”
The average 30-year fixed mortgage rate reached 7.40% on Thursday, its highest level since November 2023 and up from 6.30% a year earlier, according to Freddie Mac. Rising Treasury yields, driven by inflation fears surrounding the war with Iran, mounting federal debt and concerns over Washington’s widening budget deficits, have pushed borrowing costs sharply higher and further weakened housing affordability.