Where is the Market Heading?

June 4, 2022

By Lane Stone

Where is the Market Heading? Will the market crash this year? — Photo by Gantas Vaičiulėnas: https://www.pexels.com/photo/white-moon-on-hands-3278643/

Showing homes to my buyers almost every day of the week and holding open houses for my sellers almost every weekend, I can personally sense a shift happening. But as of right now, that’s all it is, a shift.

Buyers

Home prices are up, interest rates are up, and “Buyer Affordability” is down. Are Buyers walking away and giving up on purchasing a home? Mine are NOT! They are simply just shifting their criteria. Whether it’s lowering their max price point, expanding their search criteria, opening up to more areas, or adjusting their loan to an ARM product… They’re working with the shift, not against it.

Sellers

We are no longer in a marketplace where listing your home higher than the one that sold across the street is a valid strategy. Inventory is beginning to tick up. Buyers will start to have more options. This means that pricing your home to sell is going to be the best strategy. It will attract more buyers and still be your best option for getting multiple offers resulting in a bidding war. We are in an “instant gratification” society, so you really only have 10 days to make an impression. If you don’t plan properly, you’ll be stuck chasing the market down with price reductions.

Inventory

Yes, supply is beginning to increase, but what does that mean? What we’ve been experiencing over the past couple of years is NOT normal! Most of us have looked at the previous two years as the “new normal”, but things are finally normalizing. We had less than a 1-month supply of inventory, which means historically, even if inventory tripled overnight, it would still favor sellers. So we can handle an increase in inventory. For the month of April, we were barely over 1-month supply, so today’s buyer-demand can still handle more homes to come to the market!