Market Updates

Housing costs have reached an all-time high while the number of new and active listings have dropped. This according to a report from Redfin, which analyzed data as of September 10th. The median monthly mortgage payment of $2,632 is up 14% since last year, while the median sale price of $376,250 is also up 3.9% from last year. This is due to a severe decline in inventory, as new listings have fallen 7.1% since last year and active listings have fallen 17%. This all adds up to an 11.8% decrease in pending home sales.

Roam raised $1.25 million for their assumable mortgages platform. The New York-based startup is hoping to entice customers with the promise of heavily discounted mortgages. An assumable mortgage is when a buyer takes on the seller’s existing mortgage at the existing interest rate. This is a workaround to high interest rates that should see a lot of demand from buyers looking for lower monthly payments. Right now, only FHA and VA loans are eligible, and Roam will start by operating in five states - Georgia, Arizona, Colorado, Texas, and Florida.

The National Association of Home Builders/Wells Fargo Housing Market Index fell below 50. It dropped 5 points in September to 45, putting it in negative territory for the first time in seven months. This followed a 6-point drop in August and is due largely to the continuing rise in mortgage rates which is offsetting the decline in inventory of existing homes for sale. All components of the index across all four regions saw a decline in the last month.

The rent-to-own startup Divvy Homes went through its third round of layoffs this year. The company last raised money at a $2 billion valuation in August 2021, but the last two years have not been kind, as this latest round of layoffs is estimated to have included around half its existing workforce. The business model has struggled in the new interest rate environment, as it has to charge higher rents to compensate. Backers include Tiger Global and Andreessen Horowitz, showing that even proptech startups backed by highly regarded VCs are struggling in the current macro environment.