There’s no arguing this past year has been difficult for homebuyers. And if you’re someone who has started the process of searching for a home, maybe you put your search on hold because the challenges in today’s market felt like too much to tackle. You’re not alone in that. A Bright MLS study found some of the top reasons buyers paused their search in late 2023 and early 2024 were:
- They couldn’t find anything in their price range
- They didn’t have any successful offers or had difficulty competing
- They couldn’t find the right home
If any of these sound like why you stopped looking, here’s what you need to know. The housing market is in a transition in the
Here are four reasons why this may be your chance to jump back in.
1. The Supply of Homes for Sale Is Growing
One of the most significant shifts in the market this year is how the months’ supply of has increased. If you look at from the National Association of Realtors (NAR), you’ll see how inventory has grown throughout 2024 (see graph below):
This graph shows the months’ supply of existing homes – homes that were previously lived in by another homeowner. The upward trend this year is clear.
This increase means you have a better chance of finding a home that suits your needs and preferences. And if the biggest reason you put off your home search was difficulty finding the right home, this is a big relief.
2. There’s More New Home Construction
And if you still don’t see an existing home you like, another big opportunity lies in the rise of new home construction. Builders have worked to increase the supply of newly built homes this year. And they’ve turned their attention to crafting smaller, more affordable homes based on what’s most needed in today’s market. This helps address the long-standing issue of housing undersupply throughout the country, and those smaller homes also offset some of the affordability challenges you’re feeling today.
According to data from the Census and NAR, one in three homes on the market is a newly built home (see graph below):
This means, that if you didn’t previously look at newly built homes as part of your search, you may have been cutting your pool of options by a third. Not to mention, some builders are also offering incentives like buying down mortgage rates to make it easier for buyers to get a home that fits their budget.
So, consider talking to your agent about what builders have to offer in your area. Your agent’s expertise on builder reputations, contracts, and more will help you weigh your options.
3. Less Buyer Competition
Mortgage rates are still hovering around 7%, so buyer demand isn’t as fierce as it once was. And when you combine that with more housing supply, you have a better chance of avoiding an intense bidding war. Danielle Hale, Chief Economist at Realtor.com, highlights the positive trend for the latter half of 2024, saying:
“Home shoppers who persist could see better conditions in the second half of the year, which tends to be somewhat less competitive seasonally, and might be even more so since inventory is likely to reach five-year highs.”
This creates a unique opportunity for you to find a home you want to buy with less stress and at a potentially better price.
4. Home Prices Are Moderating
Speaking of prices, home prices are also showing signs of moderation – and that’s a welcome shift after the rapid appreciation seen in recent years (see graph below):
