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What Does the Slowing Market Look Like On the Ground? Real Estate Reddit Chimes In

What Does the Slowing Market Look Like On the Ground? Real Estate Reddit Chimes In
sam wigness headshot Staff

Aggregate housing data provides robust aerial snapshots of the market, but there’s one major problem: it lags.

Collecting, analyzing, and reporting data takes time and housing reports are often released weeks or months after the time period represented.

For example, yesterday (June 7) CoreLogic released a widely-used Home Price Insights report that showed 20.9% annual price growth in April. That’s an excellent data point, but it doesn’t do homebuyers much good a month after the fact.

To the untrained eye, a backward-looking report like this could give the impression that 20.9% price growth is happening now instead of two months ago, painting the market in an entirely different light.

So how can homebuyers get a ground-perspective of what’s going on right now? One admittedly unscientific way is to check online housing forums, which is what Reddit user u/steviesesh did by asking the posing the following question on the subreddit r/RealEstate:

“I have been noticing a shift in the market. Are housing sales starting to slow down now?

The responses from June 8 describe an entirely different market than the 20.9% price growth reported on June 7 does. Here are the major themes:

  1. Bidding wars are down and homes are selling at or close to list price
  2. Cooling is uneven and depends greatly on location, even down to the specific neighborhood
  3. Whether the market is cooling or not, don’t try to time the market. Buy when you’re ready

The responses below have been edited for length and clarity.

Homes are selling at or close to list price

u/MaRy3195 said: This is what we’ve noticed in our market. Seeing most sales at list or close to list (instead of 50, 75, 100k over). Also significantly more inventory. There are a few houses that posted right after the winter high sales prices (when inventory was next to nothing) and those ones are sitting because no one wants to pay those prices anymore.

My husband and I bought our starter home in 2019 and we were just saying how it feels more like 2019 again instead of the 2021 nightmare. Haven’t really seen sales prices going down necessarily but definitely getting more stagnant.

No mo’ FOMO buying

u/ash0805 said: I notice a shift in my area too. Homes used to sell in the coming soon status, unseen. Nice homes were gone within a day with multiple offers and sold over list. It’s not happening anymore. Homes sit in the market for weeks and few have price cuts. Granted, they are still sold way above what they should be but buyers are taking their time.

There is more inventory and buyers don’t have to make an offer instantaneously so there is no FOMO buying happening. Also, I see lenders are offering incentives like paying for appraisal and cash bonuses.

Don’t try to time the market

u/novahouseandhome said: The right time to buy or sell a house is when it’s right for you, trying to time the market is something that PhD economists who study the minutiae every day can’t do accurately.

One can only identify the top or bottom of the market after it happens.

Boots on the ground opinion: Yes, it’s slowing, but the slowdown i’m seeing is 3-4 offers instead of 12-20 offers. It’s still competitive, but not as insane as it was a few months ago.

Uneven cooling based on location

u/idig said: Depends on what area you are looking in.

High priority areas in 10/10 school districts have homes with prices still rising and people bidding $100,000 over asking.

Also, it depends on how much you can get for the house you sell.

Interest rates are still low, and if you research the early 80s, interest rates were very high, yet prices still rose due to similar supply and demand issues.

Big shifts in the Sun Belt

u/CroissantDuMonde said: Depends where you are in the country. Sun belt cities have seen huge spikes in inventory over the last month and I imagine inventory will continue to grow through summer. Most sellers haven’t figured out that they’re not gonna get top 2021 comps now with mortgage rates pushing 6% and weakened demand.

Observations from Phoenix

u/gila-moster_ said: I’ve been regularly following listings and sales in my zip code (Phoenix area) over the past year just for fun. It’s only been within the past 2 months that I’ve seen multiple listings with price reductions; multiple sales at or below listing price.

I’d buy now if I was in your situation and the following conditions were true:

  1. Found a house I loved, at a price I could easily afford, and don’t pay over listing
  2. Plan on living there for about 10 years or more
  3. Don’t acquiesce to outrageous seller demands (waive inspection, concessions, etc)

TLDR (too long, didn’t read) it seems like buyers are now starting to have more leverage for negotiating pricing/terms. If you find the ‘perfect house’ that fits your criteria, there’s no time like the present. Just don’t compromise.

Still hot in St. Petersburg

u/Bradimoose said: Not in St Pete. My friend just got outbid on a 2 bed/1 bath 900sq ft house. They offered $50k over asking and lost. There’s unlimited money out there and it’s all coming to Florida.

Depends on the neighborhood

u/nikidmaclay said: Depends on location, and city may not be specific enough. Most neighborhoods in my market are still aggressively seller driven while some others have slowed slightly.

“Smells like desperation to me”

u/Substantial_Rush_675 said: I got sellers, whose homes have been on the market a few weeks, reaching out to my realtor asking what I thought of the house. That definitely smells like desperation to me, lol. So yes, I would say it is slowing down (in the not so hot market areas).

I’m already putting down offers less than asking price. Time to get back to normal!

Don’t try to time it

u/supermomfake said: Don’t try to time it. Keep a budget and don’t go over that number. If you start looking now you might something you love or if you no big deal, you keep looking.

To which u/keiher responded: This is really the best answer to questions like these.

The bottom line

While it’s not wise to center your entire homebuying strategy on something an anonymous redditor said, the responses show the difference in narrative between real-time observations and backward-looking data posted hours apart.

For real-time information about the market you’re interested in, contact a local lender and/or real estate agent.

Further Reading

Adjustable Rate Mortgages Are Quietly Having a Moment

Home Affordability Rankings Reveal the Best Kept Secret in Housing

Mixed May Jobs Report Won’t Send Mortgage Rates Soaring