This term cropped up most recently in an analysis by Realtor.com economist Jiayi Xu, who notes, “Our weekly data suggests that the U.S. housing market keeps progressing toward a more balanced market.”
Many economists of late have remarked on the market’s more even-keel turn.
But what does a balanced housing market actually look like—and mean—for buyers and sellers?
In a nutshell, “balance” means that the raging seller’s market that’s dominated since the COVID-19 pandemic is slowly shifting—not into full buyer’s market territory, but toward a middle ground that puts buyers and sellers on more even footing.
Here’s what balance looks like—in terms of home prices, number of new listings, and more—so both buyers and sellers can better navigate this new normal of real estate today.
Homes are lingering on the market longer
Over the past two years, the pace of real estate sales has sped up significantly. Nationally, homes are on the market a median 35 days before getting snapped up. But this rush is waning.
For the week ending Aug. 20, properties spent four extra days on the market compared with this time last year.
“For a fourth week in a row, homes are sitting on the market for a longer time than last year,” adds Xu. “As both buyers and sellers adjust to the rebalancing market, expectations shift, reducing the sense of urgency in the market and reinforcing the trend toward longer sale timelines.”
Home sellers are less eager to list
While today’s homebuyers are less gung-ho to sprint to the closing table, home sellers are also dragging their feet to the market. For the week ending Aug. 20, the number of new listings dropped by 12% from a year earlier.
“This week marks a seventh straight week of year-over-year declines in the number of new listings coming up for sale, and a second consecutive week with double-digit declines,” notes Xu.
This newfound reluctance to list not only means buyers have fewer fresh listings to peruse, but it could also throw the market’s rebalancing progress off-kilter.
“This pullback from sellers could slow the speed at which the housing market rebalances,” says Xu. “Buyers looking for more bargaining power may need patience.”
Sep 5, 2022