June delivered a mixed bag of news for the housing market, showing both momentum and signs of a cooling economy. Here’s what you need to know if you're buying, selling, or simply trying to understand how national trends affect us in the Bay Area.
Existing vs. New Home Sales
Sales of existing homes dropped 2.7% in June, down to an annualized rate of 3.93 million, the slowest pace in nine months. The big culprit? Limited inventory. On the flip side, new home sales edged up 0.6% to 627,000 units per year, though that figure still fell short of analyst expectations and was down 6.6% compared to the same time last year.
What’s Happening With Prices?
Median sale prices told two different stories:
Existing homes: Hit a record high at $435,300
New homes: Dipped to $401,800
But don’t let that price drop fool you—this isn’t about declining home values. It’s all about the mix of homes sold. Last month, we saw 5,000 fewer high-end home sales (above $500,000) and 5,000 more sales in the $300,000–$399,000 range, which brought the median down without signaling falling prices.
What About the Job Market?
Initial unemployment claims dropped to 217,000 (a low not seen since April), but continuing claims ticked up to nearly 2 million. Translation? While layoffs remain low, people are taking longer to find new jobs. That tension in the labor market matters—a cooling but not crashing job market creates uncertainty for both buyers and sellers.
Key Economic Reports to Watch This Week
1. Consumer Confidence: Higher confidence usually leads to more spending, which could push mortgage rates up. The July index rose to 97.2 beating forecasts and showing consumers are feeling more optimistic.
2. JOLTS Report (Job Openings): A high number of unfilled positions typically means wages, and possibly rates, could rise. Openings are still steady at 7.5 million.
3. Q2 GDP: A stronger economy means higher yields and possibly higher mortgage rates. Weak GDP? Rate cuts may be on the table.
4. Fed Meeting: The Federal Reserve isn’t expected to change rates, but all eyes are on Jerome Powell’s tone. Dovish = lower rates. Hawkish = higher for longer.
5. PCE Inflation (Fed’s Favorite Metric): Cooling inflation supports future rate cuts. A hot report could delay them.
6. July Jobs Report: Job growth, unemployment, and wage increases will heavily influence mortgage rate direction.
Consumer Confidence & Market Momentum
Why does consumer confidence matter so much? Because it drives spending, which powers 70% of the U.S. economy. When people feel good about their financial future, they’re more likely to make big purchases. including homes.
In July, the Consumer Confidence Index jumped to 97.2, beating expectations. Pair that with stock market highs and a strong labor market, and it’s clear the economy is still running hot.
Global Trade + Market Impact
Markets are surging after the announcement of a new U.S.–EU trade framework, seen as a win for U.S. exporters. Combined with strong confidence data, the stock market continues to hit new records. But there’s a flip side: when stocks soar, investors tend to pull money out of bonds, pushing yields, and mortgage rates, higher.
Housing Affordability: A Crisis in the Making
We are now officially in the most unaffordable housing market in U.S. history. The median-priced home requires an income of $123,000, but the median household earns only $79,000. That’s a 56% affordability gap.
Even though more homes are hitting the market compared to last year, new listings are starting to slow. If that trend continues, we could see tighter inventory again, pushing prices up despite buyers already being priced out.
How Buyers Are Funding Down Payments
For many younger buyers, traditional saving isn’t enough. Here’s how they’re getting creative:
24% received cash gifts from family
18% lived with family to save
20% sold stocks
12% tapped into crypto gains
12% pulled from retirement savings
Still, over 56% saved directly from their paycheck, showing the value of disciplined saving.
7 Key Market Trends From Redfin’s June Report
New listings fell 3.2% month-over-month—the sharpest drop since early 2023
Total homes for sale dipped slightly, though still up 13% YoY
Pending sales declined to their lowest since Nov 2023
Cancellations surged, with 15% of pending deals falling through
Prices hit a new record, but annual price growth slowed to 1.0%
Time on market increased to 39 days
Fewer bidding wars, with only 30.9% of homes selling above list
Buyer’s Market? Ask These Questions:
How long are homes sitting on the market?
What percentage are selling below asking price?
What’s the current supply-to-demand ratio?
These questions help determine how much leverage you really have as a buyer.
Final Thoughts
Homeownership is still one of the best long-term investments you can make, but it requires strategy, planning, and a strong team on your side. Whether you’re navigating high rates, tight inventory, or affordability concerns, we’re here to help you find your place in the market.
Want help creating a plan? Reach out, we’re just a click away!