24 Hours that Suddenly Improved the Market
This year started strong for real estate, but then the market began
to soften. Home inventory in the starter and move-up categories dwindled
to almost nothing, mortgage rates were projected to rise, and home
sales had decreased for several months in a row.
To many, the outlook heading into 2019 appeared dim… at best.
Then, in a 24-hour window last week, things seemed to change. On Wednesday, the National Association of Realtors’
(NAR) revealed in their Existing Homes Sales Report
that home sales had INCREASED for the second consecutive month. The next day, NAR’s economic research team announced
that the percentage of first-time buyers in the market was higher than last month and even higher than a year ago.
What happened to turn around the downward momentum in the market?
You only needed to wait a few hours to find out. On the heels of NAR’s revelations, Zillow released their November Real Estate Market Report
“After nearly four years of annual declines in inventory, the number
of homes for sale has now increased year-over-year for three straight
Ending 2018, we now know two things:
*Listing inventory increased over the last three months
*Home sales increased over the last two months
Maybe a lack of inventory was the major challenge all along.
But, what about those pesky interest rates?
Last Thursday (the day after all of the above news), Freddie Mac announced
that mortgage rates did not increase but instead decreased…again. From their release:
“The response to the recent decline in mortgage rates
is already being felt in the housing market. After declining for six
consecutive months, existing home sales finally rose in October and
November and are essentially at the same level as during the summer
This modest rebound in sales indicates that homebuyers are very
sensitive to mortgage rate changes – and given the further drop in rates
we’ve seen this month, we expect to see a modest rebound in home sales
Will 2019 start out better than many have predicted? Perhaps, but
we’ll have to wait and see. Things do look much better today, though,
than they did just a month ago.