While fall typically brings a slowdown in the real estate market, this year is defying the trend. Thanks to lower mortgage rates and a growing inventory of homes, buyers are finding opportunities that are rare for this time of year, according to Zillow’s latest market report.
A Window of Opportunity for Homebuyers
As mortgage rates dip and more homes hit the market, homebuyers are in a stronger position than usual. Zillow’s Chief Economist Skylar Olsen explains that late summer and early fall may be a golden opportunity for those who’ve been waiting on the sidelines for affordable monthly mortgage payments.
“Buyers have more options for two reasons,” says Olsen. “First, lower mortgage rates are making it easier to qualify for homes. Second, increasing inventory is giving buyers more negotiating power. While hot markets are still competitive, certain metros and neighborhoods are becoming more favorable for buyers.”
Lower Mortgage Rates and Increasing Inventory
Nationally, falling mortgage rates have reduced the monthly payment on a typical home by over $100 from its peak in May. This decline is making homeownership more accessible, pushing demand higher than is typical for the fall season.
It’s not just mortgage rates giving buyers the upper hand. Zillow’s July market heat index indicates that for the first time in two years, the market has shifted from a seller’s market to a more neutral territory, allowing buyers more leverage.
Miami Market Still Strong
However, not all markets are cooling off. Zillow’s home value index shows that Miami’s market remains hot, with a typical home value of $489,781 and a monthly mortgage payment around $2,473, down 3.5% from July. Homes are selling quickly, with 22% of listings seeing price reductions, and inventory in the city has dropped 11.6% since the pandemic.
National Trends: Slower Sales but Higher Inventory
On a national level, homes are still selling relatively quickly, with the average home selling in 20 days in August, a slight increase from July. The total inventory of homes on the market has risen to 1.18 million — the highest level since September 2020.
Sellers are also adjusting to the new market dynamics, with more than one in four listings experiencing a price cut in August, a figure that’s higher than usual for this time of year.
With lower mortgage rates and increasing inventory, fall 2024 is shaping up to be a season of opportunity for homebuyers. Whether you’re in a competitive metro or a market that’s cooling off, now could be the right time to make your move. Keep an eye on inventory trends and mortgage rate changes as you explore your options this fall!
