In a surprising turn, existing home sales increased year-over-year in October, reaching a seasonally adjusted annual rate of 3.96 million. This marks the first rise in over three years, providing a glimmer of hope for a housing market that has seen record lows in 2024. So, what does this mean for buyers, sellers, and the market as a whole? Let’s dive into the key takeaways and trends shaping this recovery.
A Turning Point for the Housing Market
While 2024 is on track to record the fewest home sales in history, October’s rise may signal the beginning of a recovery. Data from the National Association of Realtors (NAR) highlights three pivotal trends:
- More Homes Are Selling, and Prices Are Rising
- Inventory is Expanding
- Buyer Demand is Returning
Let’s break down these trends and what they mean for homeowners and prospective buyers.
1. More Homes Are Selling, and Prices Are Still Rising
For homeowners, the rise in home sales and prices is great news. In October, the median existing-home price increased to $407,200, up 4% compared to last year. This marks the 16th consecutive month of year-over-year price growth.
According to Lawrence Yun, NAR’s Chief Economist, “The ongoing price gains mean increasing wealth for homeowners nationwide.” Projections are even more optimistic, with home prices expected to rise 9% in 2025 and 13% in 2026.
What This Means:
- For Sellers: Now could be an excellent time to cash in on rising equity. Homes are appreciating steadily, offering an opportunity to sell at peak prices.
- For Buyers: While prices are climbing, stabilizing mortgage rates may make purchasing more feasible.
2. There’s More Inventory to Choose From
After years of tight inventory, the market is finally opening up. Nationwide, the inventory of unsold homes rose by 19% compared to last year. For buyers, this means more options and a less competitive landscape.
What This Means:
- For Sellers: With more homes on the market, competition is heating up. To stand out, focus on staging, professional photography, and competitive pricing.
- For Buyers: You’ll have more breathing room to explore your options. Use this time to find the right home without the pressure to overbid.
3. Buyers Are Starting to Come Back
For the first time since July 2021, existing home sales are up year-over-year. Elevated mortgage rates—hovering around 6.78% for a 30-year fixed loan—haven’t deterred buyers entirely. Factors like job stability and growing economic confidence are driving demand.
What This Means:
- For Sellers: Motivated buyers are entering the market, creating a sweet spot for listings. By leveraging rising demand and stabilizing rates, you can attract serious offers.
- For Buyers: With predictions for mortgage rates to dip into the lower 6% range by 2025, now may be a good time to prepare for a purchase.
Final Thoughts: What Should You Do Next?
For Sellers:
If you’ve been contemplating selling, act now. Rising prices and returning demand make this a prime opportunity. However, with inventory expanding, it’s crucial to:
- Stage your home professionally
- Invest in high-quality photos
- Price competitively
For Buyers:
The growing inventory is creating a buyer-friendly market. To make the most of it:
- Get pre-approved for a mortgage
- Define your budget clearly
- Be patient as you explore available options
Whether you’re buying or selling, understanding these trends can help you navigate the housing market with confidence. For personalized advice and local market insights, contact our team at Encore Realty today!
