What is exactly going on in the real estate market?

This is a crazy real estate market that we've got going on right now. There's several dynamics I wanted to tackle today.

Number one, let's talk about sales. What's going on with home sales in the month of September? Home sales were down. How much depends on the area. So there's a variance here. There's a range. Home sales were down somewhere between minus 13% year over year. This is comparing September of this year compared to September of last year to as much as 35% down over that same period September this year to last year. So quite a big range there. It really does depend on the particular areas, it’s very regional right now.

It’s the same thing when you get to homes for sale, it's become very segmented by area. So if you're wondering, are home sales down in your exact area or neighborhood compared to others? I mean the only way to know is to run some numbers specific to your area. But in general, in our bigger market area, home sales in September were down minus 13% to a range of about minus 35%.

What we are seeing with homes for sale is a slight building of that inventory. It's not crazy, there's not a big wave of inventory coming yet. I say yet, meaning I don't even know if that's going to happen, but we are seeing more homes on the market than we had previously, which is a good thing. We're certainly nowhere near a situation where we've got this surplus where it's going to start to have an impact on things in a negative way right now.

Building some inventory is good. It gives home buyers more options. It gives home buyers the opportunity to go see a string of homes and put a little thought into what do I want to buy here? Which one's my favorite? Versus the crazy times of the last few years where you'd literally have to run into a house, there'd be other showings going on around you and you'd have to make a snap decision and just live with it. It is calmer now.

Homes are still selling though, for sure they are, but it is a more calm market. It's probably the best way to describe it. With inventory starting to grow a little bit. So what are some of the good parts of this? As I said, if you're a home buyer, you've got more selection. Clearly you're impacted by higher interest rates, but by the same token, because the higher interest rates have slowed the market, there isn't the bidding wars to compete against that home buyers were facing before.

You may even be able to now negotiate some closing costs being included in the purchase price or those types of things. So interest rates are definitely having an impact for sure. No one knows where they're going. A few months ago, everybody said by the end of the year, rates would be back in the fives. Well, that's not anywhere on the horizon right now with the Federal Reserve even considering another rate increase by the end of the year. So if you're a home buyer, it might actually make sense with the calmer market conditions, the ability to maybe work in some incentives and the prospect of even higher rates, now may be a time to make a move.

 If you're thinking of selling, homes that are coming on the market that are priced right, that are nice, are still selling in a day or two, that hasn't changed. There's not enough inventory on the market for the demand that we still have for buyers.

And so if you price your home correctly, I don't mean the giveaway price, but if you put your home in the market and get it priced correctly, it's going to sell very quickly for still something close to what I would consider to be top dollar. The prices have not dropped.

So when you look at home prices, they're up, and again, we go back to this whole thing of it's more area specific, but home prices are up in a range from 6% up over September of last year to as much as 15% over September of last year depending on the area. And so home prices are still rising.

Curious about what your home would sell for in today’s market? You can find out here!

There isn't a downside yet to the home pricing trend. They're all upward and in some cases still quite a bit upward. There are some areas where home prices are flat. I even saw a couple where they were down minus two or minus one, but they were in areas with very small amounts of sales in the area specifically.

So it is still definitely a good time if you're thinking about selling a home to consider doing it now with less competition.

By Spring will there be more? I don't know. No one does. If someone tells you they know what's going to happen in the spring, they're crazy, you shouldn't be listening to them. There's a lot of dynamics moving in the marketplace right now with interest rates in particular and what the Fed's going to do and the inventory, is it going to continue to build or will we level off and have a few more homes for sale, but not a dramatic amount? I suspect that's a case with home inventory.

 

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