At Peoples Choice Mortgage, we do what we do because we believe in the power of homeownership. It might seem cliche, but it is true that owning a home is a cornerstone of the American Dream. Sadly, there are many people that do not think they will ever have access to that dream. They believe homeownership is only for the wealthy and that they will have to rent forever. One of our missions is to fight for our clients and help them come up with a plan to own a home of their own. Owning a home provides material and immaterial benefits that are truly life changing. That is why we believe that everyone deserves to own a home. Thankfully, trends in home prices mean that this dream is more attainable than ever before. Here is what you need to know about home prices as a home buyer ...

Home Prices Are Declining

The housing market has favored sellers for the longest time. On top of high prices, the amount of work that goes into buying a house makes it extremely competitive. However, this has changed. Asking prices for houses are currently being slashed. These price slashes come after the U.S economy boom that was thanks to low mortgage rates and online work. Since prices are decreasing, we can see that the U.S economy boom is losing its intensity. Some places in America even have housing inventory that is not being bought. This shows how the economy has slowed down. The overheated housing market is shifting into a new phase where home buyers have more power.

Geographically, we can see that this slow down has affected many non urban areas. These buyers are looking for the best deal and picturesque homes to live in because of the pandemic. The main result of the slash could be a fear of missing out for potential home buyers. If you see a house that you like and the price is slashed, we could help you secure the home. 

Bidding Wars Are Decereasing

In addition to the housing market experiencing price slashes, bidding wars are also becoming less of a threat to buyers. Bidding wars have dominated the market for some time now. Earlier this year, we saw that bidding wars were one of the main barriers to entry in getting a home. The combination of a shortage of homes to sell with many people eager to buy set the stage for bidding wars. Bidding wars are when multiple buyers compete for a home through bidding on the property, increasing the price with each time. While bidding wars were a set back for many potential buyers, things are starting to change. 

The homebuyer bidding war rate has dropped as of September 2021, and it's been in a decline for a while. Only 58.9% of home offers dealt with bidding wars in September. This compares to a peak of 74.3% in the month of March this year. As we go later into the year and people get settled, the housing market slows down. This does not mean bidding wars are not happening at all. Competition still exists and homes are still selling faster than usual for this year. Redfin’s Deputy Chief Economist Taylor Marr comments on why the housing market has become less intense. He says that this decline in competition is normal around this season because families are heading back to school and the weather is cooling down. Thanks to the nature of the housing market, now may be a great time to try bidding on a home. 

Long Term Trends Are Great For Home Buyers

In addition to season trends, there are also data trends that confirm the falling of prices. The Case-Shiller numbers are showing that the market is turning favorable for home buyers. Case-Shiller is a three-month average repeat sales index. This means that it looks at the data of housing prices from now to past years, using a three-month span. Looking at the graph, we can see that Case-Shiller projects a deceleration in September to October. The reports are always later than the actual time we are in, so this upcoming report will reflect past months. However, the Case-Shiller graphs that release later will reveal a downward trend. Simply put, home buyers should feel more confident than ever that they can put themselves in a place to afford a house. 

Final Thoughts

The housing market has slowed to a point where you have an opportunity to get your dream home. It has never been a better time to be a homeowner. The market is starting to plateau and home prices are decelerating. Bidding wars are also declining, so all of the odds are in your favor.  Every economic indicator is pointing towards right now to be a good time to purchase a new home. Even if you are not a homeowner, you can take the steps to be one tomorrow. If you are interested in buying a home and want to take advantage of today’s favorable real estate conditions, contact us! Our team at Peoples Choice Mortgage are professional mortgage brokers because we love helping renters become homeowners. We would love to help you make your dream of owning a home a reality.