We may be sensing signs of a shift in our current real estate market.
As a housing analyst, Ivy Zellman is a trusted source of information regarding the housing market. She recently stated in her June broker report, “This month’s overall homebuyer demand rating equaled 86 on a 0-100 scale, down from 88 last month and marking the first sequential decline since November.” This is our first indicator that buyer demand may be beginning to wane ever so slightly.
At 0:55 in the video above, you’ll see the results of a survey from the home purchase sentiment index that tracks the percentage of respondents who say that it’s a good time to buy. In May of this year, 35% thought it was a good time to buy, a sharp contrast from last year when that number was 61%. Perception is reality, and if people are feeling like it’s not a good time to buy, that becomes their reality.
Next, at 1:55 in the video above, you’ll see the monthly showing time index. The chart shows that in May, the number of showings went down compared to March and April, though they’re still above where we were this time last year. There are still plenty of buyers in this hyper-seller’s market, but we seem to be seeing signs of buyer fatigue. But what’s causing this buyer fatigue? There are actually a few factors to note:
- Record price appreciation
- Extremely low inventory
- Record-high percentage of sales over list price
- Record-low days on market
- Historically low mortgage rates
The final graph at 2:59 above shows the months supply of homes for sale going back to 1999. With supplies hovering between one and two months of supply, we’re nowhere near being in a buyer’s market, but there has been a small uptick in that direction. Don’t count on the market normalizing anytime soon, but we may see a slight cooldown on this frenzied market that we’ve experienced over the last year and a half.
If you’re a buyer, we would love to help you navigate this market. You need a trusted advisor at your side to get you through your next home purchase. If you’re a seller, note that while the market still favors sellers, things are beginning to trend slightly towards buyers. That means there’s no better time to sell your home for top dollar.
Whether you’re buying or selling, or if you have questions about real estate in general, don’t hesitate to reach out to me. I’d love to hear from you.
