SEATTLE, WA — In an unusual twist for this time of year, the housing market is experiencing a surge of opportunities for buyers, thanks to lower mortgage rates and an increase in available homes. According to Zillow’s latest market report, these changes are creating a more favorable environment for home buyers as summer transitions into fall.
Skylar Olsen, Zillow’s chief economist, noted, “Late summer may be an opportunity for buyers who have been waiting in the wings for a monthly mortgage payment they can qualify for.” As mortgage rates decline, homeownership is becoming more attainable nationwide. The typical monthly mortgage payment has decreased by over $100 since May, and in high-cost areas like San Francisco, the reduction exceeds $300.
The combination of lower costs and increased inventory is shifting market dynamics. The Zillow market heat index, which had favored sellers for the past two years, moved to neutral in July. This shift is giving buyers more negotiating power, as they face a housing market where homes are taking slightly longer to sell compared to recent years.
In August, homes took an average of 20 days to sell, slightly longer than July but still faster than pre-pandemic times. The inventory of available homes has grown, with nearly 1.18 million homes on the market—the highest since September 2020. This increase in options allows buyers more time and leverage in negotiations.
For buyers, this environment offers several advantages. Lower mortgage rates enhance affordability, enabling more people to fit house purchases within their budgets. The prolonged selling times also allow prospective buyers to carefully consider their options without rushing decisions.
Sellers, on the other hand, still have reasons to remain optimistic. Well-priced homes continue to sell quickly, often within 20 days. Additionally, the share of homes with price cuts decreased in August, signaling potential increased buyer competition as the season progresses. Notably, one-third of homes sold in July exceeded their asking prices, highlighting the competitiveness for desirable properties.
The interplay of these favorable conditions for buyers and sellers suggests a housing market poised for robust activity through the fall. As the market stabilizes, buyers and sellers alike are advised to stay informed and ready to act on opportunities as they arise.
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