If you keep up with the news, you could come away from the headlines regarding the state of the housing market with more questions than answers. The boom, is it over? Is the market correcting itself or collapsing? What you should know is as follows.
The housing market is slowing down compared to the previous two years, but everyone needs to remember that the last two years were record-breaking in almost every respect. A surge in buyer demand was caused by historically low mortgage rates and the prime homebuying years of the millennial generation. Due to years of underbuilding and owners who delayed advertising their houses because of the health issue, there weren’t enough properties to buy simultaneously.
Record-high demand and record-low supply resulted from this combination, which proved unsustainable over the long run. The most recent data indicates early indications of a return to the market speed observed in the years before the epidemic rather than a crash or a correction.
Showings of Homes Then and Now
According to agents and brokers, the ShowingTime Showing Index monitors the volume of house showings.
The 2019 data provide a solid pre-pandemic demand baseline (shown in gray). The data shows that during the epidemic, house showings increased dramatically (shown in blue). Additionally, showings are still higher than in 2019, even though recent data (shown in green) indicates that current buyer desire has started to wane significantly.
And given that the housing market had such a successful year in 2019, this illustrates that there isn’t a crash in the market; instead, it is just at a turning point and is returning to more pre-pandemic levels.
Home Sales Now and Then
According to headlines, existing house sales are falling, but context is essential.
A similar narrative appears once again. The pandemic figures (shown in blue) outperformed the more normal year of house sales for 2019 (shown in gray). Additionally, the market is on track to end this year with more house sales than in 2019, per the most recent predictions for 2022 (shown in green).
To demonstrate that the present housing market is still robust, it is crucial to contrast today with the most recent average year rather than the odd pandemic year.