US existing home sales in September fell to an all-time low aside from the start of the coronavirus pandemic, with overall deal closings in Florida significantly affected by Hurricane Helene, Redfin reported on Friday. The existing home sales dropped 0.5% sequentially and 3% annually last month, arriving at a seasonally adjusted annual rate of approximately 4.02 million units.
Closed sales, encompassing both existing and new homes, decreased slightly, recording a 0.2% decline sequentially and a 1.6% drop annually, resulting in a total of 412,635 sales, the lowest figure observed since December, as noted by the real estate brokerage. Hurricane Helene made landfall in the Big Bend area of the Florida Gulf Coast late last month, which was soon followed by Hurricane Milton, a situation that could further affect home sales in October.
Among the 50 most populous US metropolitan areas analyzed by Redfin, the Florida metros experienced the most significant repercussions in September. Notably, closed home sales in West Palm Beach plummeted by 23% annually, with similar downturns observed in Tampa, Miami, and Fort Lauderdale. MaryDell Penney, Redfin's market manager in Orlando, Florida, provided insight on the challenges faced by sellers: "We have listings that were flooded and taken off the market, and sellers who were getting ready to list but can't because they need to repair damage.
Closings are being delayed because most lenders require post-storm reinspections, and insurers stop writing new policies when there's a named storm in the region." On a slightly positive note, pending home sales increased to 478,074, which reflects a rise of 2.5% from August and a year-over-year increase of 3.1%.
Redfin attributed this uptick to a drop in mortgage rates as well as the initiation of the Federal Reserve's monetary policy easing cycle. Elijah de la Campa, Redfin's Senior Economist, remarked, "September showed that there are buyers and sellers who are ready to jump into the market -- when the conditions are right.
Most buyers who went under contract last month did so when mortgage rates were falling and before two major hurricanes devastated much of the South." The median home sales price observed a year-over-year increase of 3.9%, reaching $428,212 in September. Concurrently, the average weekly interest rate on a 30-year mortgage fell to a two-year low of 6.08% late last month, although mortgage rates are currently positioned at 6.44%.
Redfin also highlighted that a 25-basis-point reduction in the central bank's interest rates anticipated for the following month is not expected to significantly influence mortgage rates, a situation that could pivot depending on the October jobs report, slated for release on November 1, if it unveils any unexpected variations. In the recent monetary actions, the Federal Open Market Committee cut interest rates by 50 basis points contrary to a consensus drawn from Bloomberg that had suggested only a quarter-percentage-point reduction.
De la Campa advised prospective homebuyers against attempting to "time the market" amid the prevailing uncertainties surrounding the upcoming jobs report and the US presidential election, stating, "If you find a house you love and can afford to buy it, now's not a bad time.".