If recent headlines about the housing market cooling and buyer demand moderating have you worried that the market is flipping fast, here’s what you need to know. Buyer demand hasn’t disappeared, it’s just eased from the peak intensity we saw over the past two years.
Buyer Demand Then and Now
During the pandemic, mortgage rates hit record lows, and that spurred a significant rise in buyer demand. This year, as rates increased due to factors like rising inflation, buyer demand pulled back or softened as a result. The latest data from ShowingTime confirms this trend (see graph below):
The orange bars in the graph above represent the last few months of data and the clear cooldown in the volume of home showings the market has seen since mortgage rates started to rise. But context is important. To get the full picture of where today’s demand stands, let’s look at the July data for the past six years (see graph below):
This second visual makes it clear that, while moderating compared to the frenzy in 2020 and 2021, showing activity is still beating pre-pandemic levels – and those pre-pandemic years were great years for the housing market. That goes to show that demand is still high today.
What That Means For This Seller’s Market
First, we need to understand where the housing market is now. It’s not the same market we had last year or even earlier this year, but that doesn’t mean the opportunity has passed.
While things have cooled a bit, it’s still a seller’s market. If you price a home around the current market value, the demand is still there, and it should sell quickly. According to a recent survey from realtor.com, 92% of homeowners who sold in August reported being satisfied with the outcome of their sale.
Buyer demand hasn’t disappeared, it’s just moderated this year. While we might not continue to see skyrocketing home prices, the demand is still out there, and while inventory stays at this level, homes should continue to sell quickly.