Homebuyers Move Farther From Work, Jobless Claims Hold Steady, Mortgage Rates Drop
Homebuyers Move Farther From Work
Homebuyers are moving a record distance away from where they now live, encouraged in part by work from home policies that allow them to settle into houses within their budgets, according to a National Association of Realtors survey.
The trade group also said that, at 26% of all sales, the share of first-time buyers in its latest reporting was the lowest since it began tracking home-buying data. That could reflect rising prices and mortgage rates that are keeping prospective buyers, including younger renters, in the rental pool and driving up apartment demand in many regions.
The typical first-time homebuyer in the latest annual tracking was 36 years old on average, also an all-time high, according to the trade group’s national survey of more than 4,800 buyers, conducted annually since 1981.
“It’s not surprising that the share of first-time buyers shrank to the lowest level ever recorded given the housing market’s combination of historically low inventory, persistently high home prices and rapidly escalating interest rates,” Jessica Lautz, the trade group’s vice president of demographics and behavioral insights, said in statement.
Surveyed buyers moved a median of 50 miles between their current and newly purchased homes, a three-fold jump from the 15-mile median recorded from 2018 to 2021. “For many, remote work decisions were formalized in the last year, providing clarity for employees to permanently move to more distant areas,” Lautz said.
Jobless Claims Hold Steady
Initial claims for unemployment insurance declined by 1,000 from the prior week and totaled 217,000 for the week ended Oct. 29, the latest indicator of a still strong employment market, the Labor Department reported Thursday. The four-week moving average for initial claims declined 500 to 218,750.
Continuing claims in all programs, tracked on a more delayed basis, totaled approximately 1.3 million for the week ended Oct. 15. That marked an increase of 28,929 from the prior week but was well below the approximately 2.7 million continuing claims in the comparable week of 2021.
Layoffs remain infrequent by historical standards in most industries. Also Thursday, the Labor Department said non-farm labor productivity rose 0.3% in the third quarter from a year earlier, as output measured in the value of goods and services produced increased 2.8% and hours worked rose 2.4%. Unit labor costs increased 3.5%.
Mortgage Rates Drop
Mortgage rates took a break from a general escalation in recent months, with 30-year, fixed-rate loans averaging 6.95% as of Thursday. The weekly national survey report by government loan backer Freddie Mac said that was down from last week’s average of 7.08%, but well above 3.09% a year earlier.
“Mortgage rates continue to hover around 7%, as the dynamics of a once-hot housing market have faded considerably,” Freddie Mac Chief Economist Sam Khater said in a statement. “Unsure buyers navigating an unpredictable landscape keeps demand declining while other potential buyers remain sidelined from an affordability standpoint.”
Khater said Wednesday’s latest rate hike by the Federal Reserve “will certainly inject additional lead into the heels of the housing market.”
Freddie Mac reported that 15-year, fixed-rate mortgages averaged 6.29%, down from 6.36% a week earlier but still much higher than the year-ago average of 2.35%. Current rates overall are at 20-year highs.