Fall 2024 Real Estate Market Update
All signs point to a quiet Fall. In September, the Federal Reserve Board decreased interest rates by 50 points. Many buyers and sellers thought that at the time of announcement is when they would see the change in mortgage rates. However, that’s not how it works. The “Fed Rate” only indirectly affects the mortgage rates. At time of announcement and shortly after, the rates started creeping up again. Right now, mid-September, they are back up to their mid 6’s. If you are looking for great rates, I recommend downloading the “Mortgage News Daily” app. While you will see averages there, it’s a great indicator of where the market is and whether you should lock your rate or not. Also know that the interest rates change on a daily basis. That said, the September move by the Feds only minimally affected the September sales as it always takes about 4 weeks to close on a house.
This year so far
It has been quiet. Even the moving season was slow and low, you could call it “sales season that wasn’t” as prices remained flat for the 3 months that should be the peak sales season of the year with 3 months (June, July and August) with flat sales amounts and sales prices.
It’s no surprise though, as buyers were waiting out to see if interest rates are going to change. Many of which chose a rental instead of purchasing as rental rates were soft and rentals were much cheaper than purchasing a home.
A brief flurry of activity happened unexpectedly in August, which was also very localized and didn’t move the needle at all.
Now to the end of the year
There are many times where real estate news sounds all the same: Between 2020 and 2022 every month inventory was decreasing and there was less and less for sale. Starting mid 2022 through now the number of homes for sale increased on a monthly basis and ended up now at the highest level since August 2015. Inevitably, this causes homes to sit on the market longer and increases the average days on market time.
In the past 3 months of this year there is a lot of uncertainty with little to no action expected from buyers, even less than in the previous months as we are approaching election day, Federal Reserve meetings, and economic reports. However, no action IS an action and it’s caused when people are not sure where things are headed.
On top of that, the winter months are overall months in which there is less real estate activity with usually lower prices. More homes sitting longer, and home sellers are more inclined to negotiate terms and fewer buyers, which means less competition.
Homebuyers
There are some insane deals out there if you are bold and are willing to do some work. The not-so perfect homes that have been sitting because they started out too high at the beginning of the moving season now have owners that are getting ready to just “let it go”. What you need to look for:
- Look for a home that has been on the market awhile. While the stigma is there is something wrong with the house, there is a good chance it’s just not “pretty” -usually paint color, various floors that do not match (color or material), few upgrades and updates. Many sellers hate doing anything, still thinking “Surely buyers don’t mind” – well they do. It shows by not buying the house
- Take a look at the neighborhood and see what the average price in a neighborhood is.
- How many price reductions it had. If you see a string of price reduction and the home for some reason or another seems to be below what the neighborhood bears. Is the house that’s been on the market for awhile, the least expensive? That’s a sign you want to “slay”.
- Be bold when you make your offer, but also be willing to walk away.
Bonus: Best of all worlds, is when you have done your research, gotten lender offers from several lenders to get an incredible rate, the home is in a neighborhood with low taxes, and low or no HOA fees.
Homesellers
It is more important than ever if you are wanting to sell your home right now to do it all. You will have to stand out to buyers in order to get them into your home with the best home preparation (Declutter, paint, maintenance), the best presentation (photos, 3D walkthrough, drone, video) and market pricing.
The biggest mistakes I see sellers make is not treating your home sale as a job on its own and wanting to just squeeze it into or on top of their current life.
You might nod and think, “This is a no-brainer, of course it’s a job” until you are faced with the task of sorting through 10 years or more worth of collections and stuff. Your REALTOR requests to paint a room, let alone a whole level in your house, and price the home below where YOU think it should be, because you want to try out the market or you can always negotiate down. Then you go through the trouble of having to leave the house whenever someone wants to see your home. Last but not least, sellers paint themselves into a corner by not wanting to put their furniture into temporary storage or move to temporary housing.
When there are no or little showings, sellers tend to nitpick pictures, wording in the description or request weekly open houses. Surely, all that should be done well, but in the end small changes will not matter unless you have done everything else with the house.
Talk to me about a home buying or home selling strategy. Plan the work and then work the plan to be most successful.
