If you’ve been waiting for the right moment to buy a home, the final weeks of 2024 could be your best opportunity yet. After enduring a challenging real estate market characterized by rising home prices, limited inventory, and high mortgage rates, recent trends indicate a shift that favors buyers. This change marks the most favorable market conditions we’ve seen in five years, prior to the upheaval caused by the COVID-19 pandemic.
What’s Changing in the Market?
Several key factors are contributing to this more favorable environment for homebuyers:
Increased Housing Inventory
One of the most significant indicators of a buyer-friendly market is the increase in available housing stock. Currently, there are approximately 4.3 months of inventory on the market, according to the National Association of Realtors®. This represents the longest period of sustained inventory levels above four months in five years.
Hannah Jones, a senior economic research analyst at Realtor.com®, notes that while the rise in inventory is partly due to slower sales, it also reflects a healthy influx of new listings, which have increased by 4.9% compared to the previous year.
The Importance of More Housing Stock
An increase in housing inventory signals a shift in the basic economic principle of supply and demand. For years, buyers faced a scarcity of options, often leading to bidding wars and compromises on their desired features. Bruce Ailion, a real estate professional and attorney, emphasizes that with more homes available, buyers can enjoy greater choice, allowing them to find properties that meet their specific needs without having to settle.
Mike Wall, CEO of eXp Realty, shares an example of a family that successfully found their ideal home with a large backyard, home office, and finished basement—features they might have had to compromise on in a tighter market.
Price Reductions Are on the Rise
With more homes available for sale, sellers are increasingly motivated to reduce prices to attract buyers. The median home price dropped to $424,950 in October, and the percentage of homes with price cuts reached 18.6%. This is a notable increase compared to previous years, indicating that buyers may have more negotiating power.
Wall recounts a situation where a buyer was able to purchase a home that had undergone two significant price reductions, allowing them to make an offer below the asking price, which the seller accepted without hesitation.
More Time to Make Decisions
The current market is also characterized by slower sales, with homes spending an average of 58 days on the market— the longest October timeframe since 2019. This slower pace enables buyers to take their time when making offers and to conduct thorough evaluations of potential homes.
Andrew Fortune, a real estate broker in Colorado, highlights a recent client who was able to revisit a property multiple times and negotiate repairs, thanks to a seller willing to wait for the right offer.
Approaching a Buyer’s Market
While the current data does not yet classify the market as a true “buyer’s market,” it indicates a more balanced environment. According to Jones, if the trend of rising inventory continues and seller activity surpasses buyer activity, we may soon see conditions more favorable to buyers.
Conclusion
For those considering purchasing a home, the end of 2024 presents a unique opportunity characterized by increased inventory, price reductions, and a slower market pace. By taking advantage of these favorable conditions, homebuyers can position themselves to make informed decisions and potentially secure their dream home without the pressures of previous years. As the market evolves, staying informed and ready to act could make all the difference in your home-buying journey.
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