Key things to know this month:
Home sales in May were 485,000, up 9% from April. Home sales forecasting models predict 519,000 home sales in June and 500,000 in July. The post-pandemic recovery is well underway and appears to be returning to a normal market cycle.
As the summer season gets underway, the real estate market continues to see dynamic change. 2024 has been a year of steady growth in home sales, with each month surpassing the previous in terms of the number of sales closed. This is certainly a breath of fresh air after what seemed like an eternity of the unknown.
Last fall was what we considered to be the market bottom, and many wondered how long it would remain at this low level before it began to recover toward some degree of normalcy. We are pleased to report that we now have five months of solid data showing month-over-month increases, indicating a steady recovery. The decline that began in the late fall and winter of last year has been replaced by more typical market trends with limited inventory.
So let's take a look.
Home sales are expected to increase slightly this month, with 519,000 transactions expected in June, before tapering off slightly to 500,000 in July. But don't worry — this pattern is consistent with the typical seasonality we experience each year, reflecting the natural ebb and flow of the real estate market.
The slight decline expected in July is the first drop of the year, but is still within expected seasonal fluctuations. This is a reminder that while the market is strong, occasional dips are part of normal cycles and will occur.
“Both the economy and homebuyers appear to be adjusting to the reality that the unusually low interest rates of the pandemic era are no longer the norm and never will be. As the market cycle returns to normal, we expect to see patterns consistent with past seasonal trends emerge going forward.”
Despite the current stability, the general perception is that the market is sluggish compared to the unprecedented highs of 2020 and 2021. This perception may be exacerbated by a generational shift in home buying and changes in buyer capabilities. Recent policy changes by the NAR will also affect potential buyers, as they will no longer be able to roll agent fees into their loans. This change will likely push out people who were within reach of buying a home.
These changes may pose challenges for some, but opportunities for others. In particular, the market environment going forward may be more favourable for cash buyers, who will be less affected by changes to fee policies.
As always, savvy and strategic buyers and sellers will find ways to navigate and succeed in an evolving marketplace. Remember, you must plant before you can harvest. Good luck!
Until next month…
Home Sales Forecast
This data correlates user activity within MoxiWorks products with the forecasted number of listings that will close within the next two months. Learn more about the Home Sales Forecasting Tool or sign up.
Subscribe to HSP
Source link