Finance
Housing begins to tip in favor of buyers; sellers slash prices to entice them back to market: report
Buyers may finally get the upper hand in the housing market. (iStock)
As buyers retreat from housing, some home sellers have had to cut their listing price to close the sale, a recent Zillow report said.
Nearly 1 in 4 sellers have had to cut prices to try and get buyers struggling with affordability interested in buying – 24.5% of listings in June had a price cut, up from 23.8% the previous month. The lack of buyer appetite is also contributing to an increase in inventory. The total number of homes on the market increased 4% from May to June to stand nearly 23% above last year’s low level. Well-priced and marketed listings are still selling relatively quickly.
Market dynamics are shifting toward a pre-pandemic normal in terms of competition among buyers and their negotiating power, Zillow said.
“A growing segment of homes that aren’t competitively priced or well marketed are lingering on the market,” Zillow Chief Economist Skylar Olsen said. “Sellers are increasingly cutting prices to entice buyers struggling with affordability.”
“For years, the housing market has been defined by fast sales and few options,” Olsen continued. “Now it’s starting to look more like it did before the pandemic in terms of competition, if not costs. As the wait for mortgage rate relief drags on, slower price growth and even dips in some areas will help buyers catch up on saving for a down payment.”
If you’re considering becoming a homeowner, it could help to shop around to find the best mortgage rate. Visit Credible to compare options from different lenders and choose the one with the best rate for you.
MIDDLE-INCOME AMERICANS FEEL MORE OPTIMISM ABOUT FINANCES AND ECONOMY’S DIRECTION: SURVEY
Home price appreciation slows
Buyers continue to struggle to get a foot on the housing ladder due to affordability challenges mainly driven by expensive borrowing rates and high home prices. According to Zillow, the typical mortgage payment is up 6% from last year and has increased by 112.5% since the pandemic.
The good news is that there is evidence that home price appreciation is slowing in some markets, Zillow said. The typical home value increased by 0.6% in June to $362,482, but the monthly growth is the lowest seen in any June since 2011. Zillow has forecasted home values to rise just 1% nationally through June 2025, which could give buyers who are currently in the market some relief.
“Home value growth has slowed as inventory rises,” Zillow said. “Annual appreciation is a reasonable 3.2% nationally, down from a 2024 peak of 4.6% in March. Monthly growth has decelerated to 0.6% — the slowest June appreciation since 2011. Slower home value growth in the months ahead could give struggling buyers a chance to make up ground.”
If you’d like to see if you qualify for a mortgage based on your current credit score and salary, consider visiting Credible, where you can compare multiple mortgage lenders at once.
Mortgage rates tip lower
Mortgage rates have tumbled for several weeks running, dropping to the lowest level since mid-March. Strong economic data and a positive inflation report provide some reassurance that the Federal Reserve may finally pull the trigger on interest rate reductions.
The Fed, which has held its policy rate in the 5.25%-5.50% range for the past year, may soon cut borrowing costs. Speaking at the Economic Club of Washington D.C. earlier this week, Fed chair Jerome Powell said that due to the policy’s long lag effect, the central bank won’t wait for inflation to hit the 2% target rate before cutting interest rates. Instead, it seeks greater confidence that inflation will return to the target before initiating rate cuts.
“Fortunately, June’s more moderate jobs report and cooling CPI were solid readings that should help the Fed gain more confidence that the economy is moving in the right direction and could raise hopes for a rate cut signal in the July FOMC statement,” Realtor.com Economist Jiayi Xu said in a statement.
If you are ready to shop for the best rate on a new mortgage, consider visiting an online marketplace like Credible to compare rates with multiple lenders at once.
HIGH HOMEOWNERS INSURANCE RATES SCARING AWAY FLORIDA HOMEBUYERS, OTHER STATES FACE THE SAME ISSUE
Have a finance-related question, but don’t know who to ask? Email The Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.
Money manager John Davi is positioning for challenges tied to President-elect Donald Trump’s tariff agenda.
Davi said he worries the new administration’s policies could be “very inflationary,” so he thinks it is important to choose investments carefully.
“Small-cap industrials make more sense than large-cap industrials,” the Astoria Portfolio Advisors CEO told CNBC’s “ETF Edge” this week.
Davi, who is also the firm’s chief investment officer, expects the red sweep will help push a pro-growth, pro-domestic policy agenda forward that will benefit small caps.
It appears Wall Street agrees so far. Since the presidential election, the Russell 2000 index, which tracks small-cap stocks, is up around 4% as of Friday’s close.
Davi, whose firm has $1.9 billion in assets under management, also likes staying domestic despite the tariff risks.
“We’re overweight the U.S. I think that’s the right playbook in the next few years until the midterms,” added Davi. “We have two years of where he [Trump] can control a lot of the narrative.”
But Davi plans to stay away from fixed income due to challenges tied to the growing budget deficit.
“Be careful if you own bonds for sure,” said Davi.
Since the election, the benchmark 10-year Treasury yield is up 3% as of Friday’s close.
‘I opt to fly private — no matter what the cost’: The caviar in first class tastes like burnt plastic. What ever happened to airline standards?
Trump’s election win cleared up some market uncertainty — these big questions remain
How remote work can help you travel this holiday season
Are American progressives making themselves sad?
U.S. Beneficial Ownership Information Registry Now Accepting Reports
New 2023 K-1 instructions stir the CAMT pot for partnerships and corporations
-
Technology6 days agoAI Use Cases: Retail, Finance & Healthcare Solutions
-
Blog Post1 week agoThe Essential Practice of Bank and Credit Card Statement Reconciliation
-
Stock News1 week agoRivian’s losses widen, but investors like hearing of ‘progress’ in next-gen EV
-
Finance1 week agoChina expected to announce highly anticipated fiscal stimulus package
-
Accounting1 day agoHow to Create an Effective Invoice Process for Small Businesses
-
Accounting1 week agoBig tax changes promised in Trump administration
-
Technology6 days agoThe Rise of Superapps: How AI is Powering the Next Generation of Mobile Apps
-
Economics1 week agoDid sexism propel Donald Trump to power?