Is The Housing Market Slowing Down?

After another crazy year of record-breaking numbers for real estate, everyone is wondering the same thing: is the housing market slowing down? Media chatter of foreclosure crises and housing bubbles has dominated the news for months. There’s no denying that today’s housing market is anything but normal.

Seemingly overnight, the Millennial generation, long known for putting its buying plans on hold, was ready to become homeowners. And as more young people started buying homes, flooding cities across the country with record-high buyer traffic, there was one hang-up: there wasn’t enough inventory to match their demands.

That inequality in the market is the root cause of the price appreciation that has many worried we’re in another “housing bubble.” But unlike 2008, the rise in home values was warranted. It wasn’t price inflation. It was price appreciation caused by simple economics: a lack of supply and high demand.

Today, economists are noticing a softening in the market but nothing that should alarm potential buyers or sellers. That doesn’t mean it’s crashing. It means that it’s finally levelling out to a more normal market.

Like any other year, buyer traffic peaked in May and April (the spring market) and is slowing as summer ends. However, it’s important to note that those levels remain similar to where we were one year ago.

This is great news for both buyers and sellers. As competition slowly declines and inventory levels rise, experts project a steady softening of the steep price appreciation we’ve seen in the past year.

And as the market continues to shift, sparking confusion and hesitance across the nation, your sphere is looking to you to educate them on what it all means.

Making sure they have the full picture shows you’re a trusted real estate professional with their best interest in mind.

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Leisure Village Begins a “SOFT RE-OPENING”


The Village Recreation and Building Facilities to Open on May 3

Remember this first step is described as a “soft opening” because health guidelines require that rooms and activities resume carefully and gradually. That means reduced hours, limited use, etc.
Main Recreation Center will be open from 9 AM to 4:45 PM, Monday through Friday. Closed on the weekends. No visiting or lounging in the Lobby.
Recreation Office will be open from 9:00 -11:45 AM and 1:00 – 4:45 PM. Limited Occupancy.
Library will be open for up to four residents at a time for browsing, returning and checking out books, puzzles, tapes, etc. No puzzle building, lounging, reading, or book donations.
Sewing Room will be open to two people at a time for a maximum of two hours. Sign in/sign out required in the room.
Garden Room and the MPR will be open with a fixed set-up and limited occupancy (which will be posted). No scheduling available.
Administration Office will be open with limited occupancy. Signage will provide details.

Will the Housing Market Maintain Its Momentum?

 

Last week’s Existing Home Sales Report from the National Association of Realtors (NAR) shows sales have dropped by 3.7% compared to the month before. This is the second consecutive month that sales have slumped. Some see this as evidence that the red-hot real estate market may be cooling.

 

However, there could also be a simple explanation as to why existing home sales have slowed – there aren’t enough homes to buy. There are currently 410,000 fewer single-family homes available for sale than there were at this time last year.

 

Lawrence Yun, Chief Economist at NAR, explains in the report: “The sales for March would have been measurably higher, had there been more inventory. Days-on-market are swift, multiple offers are prevalent, and buyer confidence is rising.”

 

Yun’s insight was supported the next day when the Census Bureau released its Monthly New Residential Sales Report. It shows that newly constructed home sales are up 20.7% over the previous month.

 

Buyer demand remains strong. With more of the adult population becoming vaccinated and job creation data showing encouraging signs, existing-home inventory is expected to grow in the coming months.

 

What will this mean for home sales going forward?

Fannie MaeFreddie Mac, and the Mortgage Bankers Association (MBA) have all forecasted that total home sales (existing homes and new construction) will continue their momentum both this year and next.

 

Bottom Line

Living through a pandemic has caused many to re-evaluate the importance of a home and the value of homeownership. The residential real estate market will benefit from both as we move forward.