The real estate market is currently undergoing a crazy shift.
As we near the close of the third quarter, the real estate market is undergoing unprecedented changes, leaving even seasoned professionals astounded by the shifts.
As of August 7, recent statistics paint a vivid picture of the evolving market landscape. A mere 14,281 homes are presently available for purchase, which is a stark contrast to the 21,263 homes listed during the same period last year. This eye-opening data reflects a substantial 33% decrease in active inventory.
Similarly, the number of pending properties has seen a decline. This year, 7,659 homes are pending, as opposed to the 8,099 homes at this point in the previous year, marking a 5.5% reduction in pending properties. Additionally, the projected total sales for the year has decreased by 28%, plummeting from 102,355 homes sold last year to an anticipated 73,813 homes sold this year.
The underlying factors behind these shifts are multifaceted. At the core, the market is grappling with historically low inventory levels. This scarcity of available homes coincides with a reluctance among sellers to move due to the prevailing high interest rates. Many homeowners, having secured favorable mortgage rates, are hesitant to transition to a new home and potentially higher rates.
The market dynamics are expected to evolve over time. As the fall months approach, an increasing number of individuals are likely to recognize the financial benefits of homeownership compared to renting, particularly given the soaring rental costs. Notably, the market is also witnessing a surge in Airbnb properties being placed on the market for sale. This trend stems from the challenge Airbnb owners face in renting out their properties enough to cover their mortgage costs.
One of the key factors influencing the market’s trajectory is the fluctuating interest rates. Currently, interest rates are experiencing instability and volatility, with potential for further changes on the horizon. While Penrose refrains from offering financial advice, I emphasize the importance of seizing the opportunity to lock in rates promptly. This strategic move provides a safety net against potential rate hikes in the future. Should rates decrease down the line, homeowners can always explore refinancing options to secure a lower rate.
Whether you’re a prospective buyer, a hesitant seller, or simply curious about the intricacies of the market, I encourage you to reach out to me by phone call or email for insights tailored to your situation. I look forward to hearing from you soon!