The real estate market is sliding gently back into more neutral conditions. But is it really neutral? There are several ways to create balance and imbalance in the market. Balanced conditions happen when supply and demand are both about equal. You can have short supply with little demand, medium supply with medium demand, or high supply with high demand. In any of these conditions the market is neutral. A strong sellers market can happen when supply is short and demand is high, but it can also happen when demand is low if supply is extremely short. Our recent market transitioned from high demand and ultra low supply to medium demand and ultra low supply, to low demand with ultra low supply where we sit now. Yes demand has fallen off due largely to the increasing cost of money. But the number of listings remains fairly low as well so prices are softening, but only a little bit.
If our market sees a sudden burst in listing activity we could see a harder crash, but for now, trends are showing a soft landing. Soft is good. Sellers worried about the declining market should consider that it can be an effective way to save a little money. If prices are falling the selling will lock in the price of the current house when they accept a buyers offer. The next house they buy will be a little cheaper as the market softens further. There can be an upside to slipping prices.
Mortgage rates right now remain in the 7s but most rates come at a cost in points. Par rates and rebate rates are not in the mix right now. Buyers will need to be ready to cough up some closing costs to get a loan and sellers should be ready for offers with buyers asking for help. This is the market we will have to deal with for the foreseeable future. It is totally manageable when you hire the right agent.
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