The Tide is Turning: Buyer-Friendly Market on the Horizon
If you’ve been holding off on buying a home, the waning weeks of 2024 might be your moment.
Rising home prices, scarce housing stock, and relentless mortgage rates have made for a tough real estate market.
But now, the tide is starting to turn, and the end of the year is turning into the most buyer-friendly market we’ve seen in a long time.
The Housing Stock is Way Up
The level of housing stock is one of the biggest indicators of the kind of housing market buyers and sellers are in.
And now, buyers have more housing choices than they’ve had since 2019.
There is roughly 4.3 months of inventory on the market, according to the latest data from the National Association of Realtors.
“This is the longest stint of four-plus months of supply in five years,” says Hannah Jones, Realtor.com senior economic research analyst.
That’s a huge shift from the conditions buyers have faced recently.
And while it’s true that the number of homes on the market is due in part to slower sales activity, there are plenty of fresh listings to choose from.
In fact, new listings rose by 4.9% from the previous year.
Why More Housing Stock Matters
More homes for sale indicates a basic economic principle of supply and demand.
For the past few years, there haven’t been as many homes on the market to meet the pent-up desire for housing stock.
“Those days are over,” says real estate professional and attorney Bruce Ailion, of Re/Max Town & Country in Atlanta.
“For years, buyers have complained there is no selection, inventory is so slim that multiple offers above list price is the only way to get a home, and too often, they had to compromise just to buy,” adds Ailion.
When inventory rises, buyers gain an incredible advantage.
“More homes on the market mean more choices, which is crucial for finding the right property with the features and amenities you want,” says Mike Wall, CEO of eXp Realty/EZ Sell Homebuyers in Dayton, OH.
More Housing Stock Means an Increase in Price Cuts
A rise in housing stock puts pressure on sellers to cut prices to differentiate themselves in a crowded market.
The median home price in October dropped to $424,950—and with an increasing number of homes available, sellers are having to lower prices even further to stay competitive.
“The percentage of homes with price reductions was 18.6%,” says Realtor.com senior economist Ralph McLaughlin in his recent analysis.
“What’s more, the overall share of inventory with price cuts is 2.2% higher than the shares seen between October 2017 to October 2019.”
Buyers Have Time to Make Offers
In addition to higher housing stock, there are other buyer-friendly market trends.
Now is “the slowest seasonal market in five years,” according to Realtor.com economist Jiayi Xu.
The market is moving at a snail’s pace, with homes spending 58 days on the market in October—the slowest October since 2019.
A week more to shop for homes eases buyers’ pressure to make quick decisions.
On the Brink of a Buyer’s Market
While the data does not yet justify a true “buyer’s market,” according to Jones, it does suggest the market is balanced.
This means “buyers are in a better position than they have been in years.”
If seller activity continues to exceed buyer activity and housing stock continues to build, the market might finally start to lean more toward a buyer’s market, which would be music to homebuyers’ ears.
“For buyers who have been waiting on the sidelines, now might be the perfect time to make a move,” says Wall.
Conclusion
The current real estate market is shifting in favor of buyers, with more housing stock, increased price cuts, and a slower pace of sales. This is the perfect time for buyers to make a move and take advantage of the opportunities that arise from a balanced market.
FAQs
Q: What is the current state of the real estate market?
A: The real estate market is shifting in favor of buyers, with more housing stock, increased price cuts, and a slower pace of sales.
Q: Why is there more housing stock available?
A: There are several reasons, including slower sales activity, an increase in new listings, and a rise in inventory.
Q: What does this mean for buyers?
A: This means that buyers have more options, can make more informed decisions, and have more time to make offers.
Q: Will the market become a buyer’s market soon?
A: While the data does not yet justify a true “buyer’s market,” it does suggest the market is balanced. If seller activity continues to exceed buyer activity and housing stock continues to build, the market might finally start to lean more toward a buyer’s market.
