Our real estate market’s surges of activity are next to impossible to forecast with any degree of precision. Since intervening events can negate even the most well-grounded projections, it’s wise to keep in mind how tentative any reading of the underlying tea leaves can be. Even so, last week’s disclosures provided a high level of confidence that a market change could be on the way.
Two disparate pieces of the national real estate jigsaw puzzle from two trustworthy sources provided the clues. The two:
• From the Wall Street Journal, a finding that “The mood among sellers…shifted in recent weeks from apathy…to urgency.” Financial advisers and real estate agents are reporting that their clients are showing a new sense of readiness to list their properties. Friday’s edition provided one good reason. In a story headlined “Fed Official Favors Aggressive Rate Increases,” the takeaway was to expect a half-point (rather than quarter-point) Fed Funds rate increase. If area homeowners now expect a series of dramatic mortgage rate hikes, a decrease in the number of qualified buyers could also follow—pressuring more sellers to list sooner rather than later.
• Recently, word came of a new survey from realtor.com that could confirm the first piece of the puzzle. It would also remove one basis for the residential market’s continuing price rises: the inventory shortage. “Housing Inventory Turnaround Possible” published the results of a new survey of 3,000 respondents. In it, a surprising 64% said they intend to sell their properties this spring or summer. For a housing market that has long been starved for inventory, a slowing of asking price increases might be expected.
If the national picture holds true for our own real estate market, a boost in the number of new listings should spur further interest from the area’s already well-motivated homebuyers.