US Housing Market Becomes More Buyer-Friendly
US Housing Market Becomes More Buyer-Friendly as Sellers Reduce Prices
The US housing market is starting to shift in favor of buyers as sellers are increasingly cutting prices, according to Zillow. In June, 24.5% of home listings saw price reductions, marking the highest rate of discounting for that month since 2018. This change is a response to the evolving market conditions, where stubbornly high costs have led to a pullback among buyers, giving those still in the market more options.
A significant increase in inventory is a key factor in this shift. The total number of homes for sale is now 23% above last year's lows, largely thanks to booming construction that has alleviated the supply crunch. This has also made it more affordable to buy a new home compared to an existing one, with a median price difference of $7,100 in May, as reported by Realtor.com.
While housing inventory remains below pre-pandemic levels, the gap between supply and demand is shrinking. June saw the lowest monthly growth rate in home prices for this time of year since 2011, with the national average home price now at $362,482. Although prices are still rising, the pace of appreciation has slowed significantly, offering some relief to buyers.
Despite these changes, it’s still primarily a seller’s market. However, the reduced demand has lessened the advantage that homeowners have had over buyers. For the first time in four years, home sales fell in June instead of increasing. Regionally, there are several areas where the market is becoming more favorable for buyers. Cities in the South, such as New Orleans, Miami, Austin, Jacksonville, and Tampa, are currently some of the strongest markets for prospective homebuyers, according to Zillow.
This trend aligns with recent reports from Redfin, which have highlighted that markets in Florida and Texas are leading in price declines. The surge in construction during the pandemic has left these states with an excess of homes, and high prices coupled with rising insurance costs are pushing buyers out.
While the housing market remains challenging, these developments indicate a more balanced environment for buyers. If you’re considering entering the market, now might be a good time to explore your options. For more insights and personalized advice, feel free to reach out to me anytime!
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