Prediction: We will have over 10,000 homes on the market in August! July will end right under the 10,000 home mark.
Why is this a big deal? We have the highest amount of inventory since October of 2013. The last time we passed 10K homes was in the middle of 2013, right before our market exploded and we saw hefty inventory drop off.
June ended with 9,520 single-family and attached homes available for purchase. Our average sold price is up 1.64% this year so far. It feels like a slowing market with more inventory and a smaller jump in home prices. For perspective, I am going to attach a historical inventory sheet to show you what our market has looked like with end-of-month inventory, and sold homes over the last 11 or so years.
There is something a little unusual about this slowdown, though; we would expect it to happen based on prices going up along with interest rates in a hot economy. Though the economy is hot, it is not keeping up with the enormous growth of our housing market. So, prices slow, inventory sits on the market a bit longer, etc…
However, the FED is a bit concerned this year, and rates look to be dropping once again. We were predicting rates to be in the 5% range, and heading higher. Currently, rates are IN THE 3% RANGE, and expected to continue to drop at least for now. This means that despite the increase in inventory, increasing prices, and so on and so forth, this market may see a shift back towards a seller’s market.
I would anticipate the rest of this year being a fantastic time to buy. If rates do continue to sit in the threes, inventory will start to decrease heavily as we hit October and November, leading to another crazy market in the early part of the year. As of right now, I would expect the market to continue on a pathway of growth and equity gains. Meaning that the market will feel more like 2018 (lower inventory, more appreciation) than this 2019 market in 2020.
All that said, June was the tipping point of the market for the year. We are going to see buyers slow down, and inventory rise over the next few months until people stop listing their homes closer to the end of the year.
I feel a bit uncomfortable honing in on the same message month-over-month, but it truly is still an incredible time to be a buyer in what is still a seller’s market. Sellers are continuing to see appreciation albeit a bit slower. Of course, any of this could change as the market dictates.
So have a phenomenal 4th of July… then go buy a house :).
Happy ‘Merica Day!