Is it smart to buy a house right now? While the choice to purchase comes down to a number of individual factors, market conditions show several advantages of buying this season:

1. More listings may be available.

Housing inventory is historically low* and relieving these low inventory levels will take time. But:

• Active listings have increased by 47 percent compared to the year before.
• The long-term outlook for newly built homes is also positive, Lawrence Yun, National Association of REALTORS® Chief Economist, says, since more new homes are needed to correct the inventory shortage.*
• Limited housing supply is also one of the factors supporting why the housing market isn’t heading for a crash like we saw in 2008.

If you’re a homebuyer, this means that you’ll have nearly twice as many listings to choose from, depending on your local area. For the many buyers who’ve had a hard time finding suitable homes, it may now be possible to purchase. While no one can predict exactly what mortgage rates will do, some housing authorities expect rates to stabilize and possibly decrease into 2023, helping to improve affordability.

❄️ Happy house hunting. Take the first step and pre-qualify**.

2. Buyer demand has slowed.

Gone are the days of multi-offer scenarios on almost every house, requiring you to bid thousands over asking price--at least for the time being. Over the past year, homebuyer demand has steadily dropped as mortgage rates have increased.

Now, you might find more homes in your price range due to slightly higher inventory levels, and with less competition, you may have the opportunity to buy one. This could be compounded by the fact that buyer activity also naturally wanes in the winter. If you continue your home search through the winter months, you may find more ease in getting your offer accepted.

3. Home prices are expected to keep rising.

Mortgage rates may possibly level off, but the same may not be true for housing prices. Forecasts from housing authorities vary, but CoreLogic currently predicts a 3.9-percent year-over-year home value increase. If you’re prepared to buy now but are hoping to time the market, rising home values may factor into your decision. The home you’re looking at today has potential to cost more a few months in the future.

Of course, higher home prices aren’t the only reason to expedite a home purchase. Talking with your Loan Officer can help you weigh your options and determine when buying makes sense. Buying sooner, for those who are able, also gives you the chance to build your prosperity; your home equity will grow as home values rise.

4. Price cuts are possible.

As higher mortgage rates have pumped the brakes on homebuyer demand, many sellers have begun to drop their prices. Time on the market is also longer—now at 34 days. This winter, sellers may be more motivated to consider and accept offers rather than risk sitting on a stale listing.

On top of market-driven price declines, you might also enjoy seasonal price dips. December and January have some of the “best days to buy,” according to ATTOM Data numbers. Some seasonal price cuts can also vary by state. For example, Maryland, Connecticut, and New Jersey may see notable price decreases in the winter.

5. You may have more negotiating power.

As you probably observed, the rock bottom mortgage rates seen during the pandemic triggered unprecedented levels of buyer demand, creating a strong seller’s market. Now, the tides are slowly turning:

• It technically remains a seller’s market, evidenced by the 3.3-month supply of unsold homes that’s still below the levels needed to sustain a balanced market.
• But as demand moderates, homebuyers are seeing their negotiating power increase.

In the months ahead, bidding wars will be much less likely, especially since winter is already considered an off-peak season. Buyers may also be less likely to waive their inspection or appraisal, and sellers may be more willing to accept contingencies. If you’re a homebuyer, you may have more room to negotiate on repairs and/or price. As many as 92 percent of sellers recently accepted offers considered “friendly” to buyers.