A Moderating Housing Market Means More Options for Home Shoppers




A Moderating Housing Market Means More Options...

That was the headline from the Realtor.com® National Housing Forecast Update in June 2022. The economists behind the annual study issued a revised forecast to account for the following elements in the housing landscape:

  • Mortgage rates are revised upward to reflect the major shift in monetary policy and financial conditions over the last 6 months; thru the second half of 2022, the 30-yr rate stabilizes at 5.5%.
  • Going forward, home price growth cools, but it has remained hotter for longer than originally anticipated leading to an upwardly revised projection of 6.6% home price growth for 2022.
  • Home sales slows (in units), modifying original 2022 growth expectations to a decline of 6.7%. While the forecast is a notable step down from 2021, home sales on par with these projections would mean that 2022 sales are the 2nd highest tally since 2007, trailing only 2021.
  • The inventory of homes for sale grows more than originally projected, up 15% from 2021. The growth is driven by a combination of more sellers and a slowing home sales pace. Important to keep in mind that inventory is still down 46% from 2019.

What does a "cooling" home price environment mean? How might the moderating buyer/seller balance in the marketplace enable different offer strategies than this time last year. I offer some brief thoughts on this linked video.




For insightful and actionable info, click the linked article 'Storm of rising costs' is giving some persistent homebuyers an edge. 

“Those who can weather this storm of rising costs are having an otherwise less stressful buying experience compared to the pandemic-fueled rush on real estate in 2021,” Jeff Tucker, a senior economist at Zillow, said in a statement. “They have more options to tour, more time to find the right house, and are less likely to face a bidding war.



Comments

Post a Comment

Popular posts from this blog

Be the Landlord

Image
  Participate in RE Beyond Ownership of your Primary Home Have you considered investing in rental property? It may not be as big a leap as you imagine. The moderation of the residential real estate market could create opportunities for you to participate beyond ownership of your primary home. Recounted in the WSJ article linked below, home purchases by investors large and small climbed to record levels during the pandemic, reaching a high of 28% of all single-family home sales in February of 2022, up from 17% during the same month in 2019 (housing data firm CoreLogic).   Assess the Housing Market   The first step would be to assess the long-term direction of the housing market. As I wrote last week, residential real estate trends are best viewed from both national and location-specific perspectives. On a nationwide basis, there is a well-documented home inventory shortage. Match this with demographic pressures, the  catch-up growth in Millennial purchases will drive ...
Read more

Making an All-Cash Offer - Wouldn't It be Great to be in the Driver's Seat

Image
Have you competed unsuccessfully against an all-cash offer? Still waiting for your sudden "wealth event" like money from IPO, sale of your company or cryptocurrency windfall? This CNN article gives insight into the extra $$$ required to competitively sweeten the deal and overcome the appeal of all cash and short close. Look into how you too may also go the route of an all-cash offer, without actual cash. Click CNN all-cash-home-buyers
Read more

Realtor.com - Financial Outlook for Residential Real Estate Markets

Image
Middle TN Inventory Remains Tight Available Inventory vs Sold 2018 - 2022 With all eyes focused on the rise of interest rates to slow the rate of inflation, how does this affect the residential real estate market and specifically the local Middle TN environment? Last week I pointed to the downturn in home sales and a rise in active inventory. Yet from a historical perspective we are experiencing an ongoing shortage of available properties. There remains a big gap between the small number of homes available for sale and the overwhelming number of buyers looking to make a purchase. Sellers' perspective: Price appreciation is decelerating.  It continues to appreciate, but at a slower pace. “We do still expect home prices to cool, but we’re starting at a higher price point,” says Realtor.com Chief Economist Danielle Hale. Buyers' perspective: More homes to choose from in our local market.  Up 21.7% from prior month, and 18.2% over same time last year.  But keep in mind, Middl...
Read more