Wait… aren’t prices supposed to be falling???
We have seen 5 consecutive months of values coming down, however last month when interest rates dropped down into the 5’s buyer activity actually picked up, which caused inventory levels to come down. This push in demand and dip in supply pushed values back up slightly, being the first month in a while to see value increase. But will this trend continue moving forward?
This month’s stats:
This month we saw about 1,207 new listings hit the market and over 1,600 homes actually sell. When there are more sales than there are listings, it usually means prices will come up. Another stat that stood out to me is that we are down 24% in the amount of sales we’ve had this year compared to last year. While this may seem drastic, we have to remember that 2020 and 2021 are outliers in the market and not great to compare to. If you look at the 5 year average, the amount of sales we are seeing in the 4th quarter is similar to what we were seeing in 2018 and 2019. This could indicate that we are now in more of a normal market. That’s of course if interest rates level out.
What do we need to look out for?
We have to keep our eyes on interest rates. The Fed has already come out and said they will be doing another half percent increase. However, a lot of this increase is already baked into our current mortgage rates. Right now rates are floating between 6%-6.5% and I don’t see them getting back into the 7% range. I will say that if the Fed does drive those rates back to the 7’s, that could have a significant impact on values.
Buyers, don’t be afraid to get in the market right now. I have seen my clients get phenomenal deals recently thanks to the negotiating power buyers now have. Getting closing costs paid for, buying down your interest rate, and getting a great price on a property you really love are all things that were unheard of for buyers over the past couple of years. You don’t have to be ready to buy right now but at least get some exposure in the market and start educating yourself so that when you are ready, whether it’s 6 months or a year down the road, you will know what a good deal looks like.
To all my sellers out there, you have to be prepared to negotiate in this type of market. We’ve had more cancellations across the nation than any other time in the last 10 years. This is happening because of the uncertainty of buyers during this time. They are being extra diligent with their inspections and negotiating. You have to be prepared to be on more of an equal playing field opposed to the crazy advantage sellers have had over the past couple of years.
If you would like a FREE strategy call with me, please reach out. I love helping people through these tough decisions. Happy holidays to everyone out there who has been following me and watching my videos, I really appreciate you! And to all my clients out there, I sincerely appreciate the support over the years.
- If you are thinking about buying or selling we would love to help!
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