Rising interest rates have created a stir in the real estate market, with many buyers and sellers alike re-evaluating their real estate decisions. Sellers may be considering selling before home prices change (seeing as they are still at historic highs), and buyers may be reconsidering how much home they can afford.  Median list prices have grown 16.9% over the last year, and while the rate of acceleration has slowed down, listing prices have more or less continued to grow.

In April, we saw a median home price of $425,000, and in May we saw it rise to $447,000 (an all time high).

Additionally, the amount of time a listing sits on the market has changed. The national median is currently at 31 days on the market, which isn’t a “ton of breathing room” for buyers but at least more than the 21-day median we saw early 2022.

What does this mean?

Demand is cooling in many real estate markets because of the influx of sellers looking to take advantage of home prices. Many who waited until after the 2020-2021 season are now ready to list.

“This is the first relatively normal year since the start of the pandemic. I think a lot of people were afraid they were going to miss the heart of the selling season last year and just decided to postpone their home sales,” says Hale. “They weren’t quite ready to make moves last year—and they definitely are now.”

However, buyers are either finding challenges with affordability or, simply not feeling the pressure to buy currently. With increasing inventory and longer days on market, buyers have more time to shop and find their dream home without worrying about a bidding war.

31 days on market may not seem like a long time compared to previous years, but after the bidding wars we saw in the past year, this a welcome breath of fresh air for many homebuyers.

“In the most recent week, homes sold just four days faster than they did last year,” Hale says. “They’re still selling faster than a year ago, but that gap is shrinking, and eventually I expect to see homes sell a bit slower than last year.”

The Pros for Sellers

Sellers should not be discouraged from listing at this time, considering that home prices are still at an all time high and inventory is still low enough to get sellers top dollars for their property. Thanks to work from home opportunities, inventory and longer days on market, buyers are able to remain flexible in where and what they can purchase.

The data contained herein is obtained from sources deemed reliable, but accuracy is not guaranteed. Data gathered from Realtor.com