Key Takeaways:
- Understand the dynamics driving the summer housing inventory.
- Know the factors fueling a cooling shift in buyer demand explained.
- Linda Craft & Team will help you get your dream home – contact us today!
It’s no secret that the housing market has delivered a fair share of challenges to homebuyers over the past two years. The two biggest hurdles for homebuyers during the pandemic have been the limited number of available homes for sale and the intensity and frequency of bidding wars.
But the nation’s housing supply and the intensity of bidding wars have shifted toward favoring buyers in Summer 2022, helping to cool off what has been a historic hot housing market.
So, let’s look at what’s driving these recent housing market changes and how they will likely impact your homeownership goals.
What’s Really Going On With Housing Inventory
Even as new sellers took a step back from the market, the number of available homes for sale has increased this year. As Danielle Hale, Chief Economist for realtor.com, explains:
“New listings – a measure of sellers putting homes up for sale – were up 6% above one year ago. Home sellers in many markets across the country continue to benefit from rising home prices and fast-selling homes. That’s prompted a growing number of homeowners to sell homes this year compared to last, giving home shoppers much needed options.”
The good news is that as more homes for sale continue to make themselves available on the market, the supply of open homes increases your chance of finding your perfect dream home that checks all your boxes.
Buyer Competition Helps Inventory Grow
Inventory growth is happening because of an increase in the number of available homes for sale but also because buyer demand has softened in light of higher mortgage rates and other economic factors such as inflation. According to Mark Fleming, Chief Economist at First American:
“There has been a pickup in the inventory that we’ve seen recently, but it’s not from a big increase in new listings . . . but rather a slowdown in the pace of sales. And remember that months’ supply measures the inventory of sale relative to the pace of sales. Same inventory, fewer sales, means more months’ supply.”
The market shifted away from its previous frenzy of buyer competition seen early during the pandemic, helping available inventory grow. In their latest forecast, realtor.com also mentions the moderation of demand as a critical factor and projects that inventory growth should continue:
“As rising inflation and mortgage rates bring U.S. housing demand back from the 2021 frenzy, . . . inventory will grow double-digits over 2021 and offer buyers a better-than-expected chance to find a home.”
How The Housing Market Impacts You
The combination of more available homes coming onto the market and a slower pace of home sales means you’ll have more options to choose from as you search for your next home. That’s great news if you’ve been exploring with little to no luck. But, remember, there isn’t a sudden surplus of inventory, just more homes to choose from than a few months ago. So, just because the market has shifted to favor buyers, you’ll still want to be decisive and move fast when you find the right home for you.
And when you do, you’ll face less competition from other buyers. So if you’ve been waiting to jump into the market because the intensity of the bidding wars was intimidating or if you’ve been outbid previously, this moderation could help make the home buying process smoother.
Contact Linda Craft & Team Today
As the housing market shifts toward pre-pandemic levels, many unique opportunities are still in front of you. And with buyer competition lessening and more available homes for sale entering the market, your home search has gotten less challenging. So reach out to the experts at Linda Craft & Team to begin the process today!