dailynewsnblog
There are plenty of reasons to be worried about the housing market this spring: Mortgage rates are stubbornly high and rising. Economic sentiment is dreary. Prices are still out of reach for many aspiring buyers.
But despite the gloomy signals, buying and selling activity looks surprisingly resilient. Contract signings have risen for three consecutive months and are outpacing last April’s levels by 3.2%. Completed home sales also eked out a small gain from a month earlier.
One change that might explain the improvement: Homebuyers and sellers have their price expectations in sync.
The share of sellers who cut prices in April dropped 1.3 percentage points from a year ago, even though median list prices per square foot also fell, according to Realtor.com data. Together, those statistics point to a market where buyers and sellers are making price compromises and getting more deals done
“It’s not just that more buyers are coming to market, but that sellers are pricing initially at a level that is basically meeting buyers where they are,” said Jake Krimmel, a senior economist at Realtor.com.
Read more: Is now a good time to buy a house?
Contract cancellations and pulled listings — two indicators that spike when buyers and sellers are at odds — are also back at more seasonally typical levels after jumping last year.
So far this spring, buying and selling activity in Raleigh, N.C., has been healthy, said Samantha Gradle, a Realtor in Apex, N.C. Buyers are active, but they can afford to be choosy as prices have cooled somewhat. Sellers, in turn, have become more willing to offer concessions, such as paid roof repairs, to get deals finished.
“The last six months have gotten really, really nice,” Gradle said. “I’ve had buyers get a lot out of sellers very recently.”
Many parts of the country where price reductions are now on the decline were once pandemic boomtowns. There, home prices have fallen dramatically from their peaks a few years earlier, a reality that not all sellers were willing to face until now.
Fewer price cuts this year suggest that sellers now understand what buyers are willing to pay. In Jacksonville, Fla., price cuts have dropped 5.1 percentage points from a year ago, while in Miami, they’re down 4.4 percentage points. Contract signings in both cities are now up.
Simple supply-and-demand factors also play a role. In Philadelphia and nearby suburbs, the share of sellers cutting prices from March to April declined 3.4 percentage points, according to Redfin data. Brenda Beiser, a Redfin Premier agent in the city, attributes it to strong demand from the area’s buyers and limited inventory.
