As homebuyers race to beat interest-rate hikes, the national housing market continues to spiral out of control even as home sales volumes rise (slightly) and properties in some markets find themselves sitting for more than 72 hours (gasp). With most of the country still locked in a crazy housing hot-pot, it seems impossible to spot markets where a little bit of “cooling” (read: less-than-two-digit appreciation year-over-year) might be giving buyers a tiny bit of an edge. However, Realtor.com is bravely trying to identify some markets where investors and cash buyers might stand a chance against retail buyers, thanks to higher interest rates and lengthening time-on-market.
Danielle Hale, chief economist for Realtor.com, explained that things are still just, well, “blistering” in most markets around the country. “The big trend that we have seen just about nationwide is that homes are not sitting for very long anywhere,” she observed, adding, “But there have been some signs that demand is cooling.”
Hale and her team said that they believe 2022 is likely “the first relatively normal year since the start of the pandemic,” speculating that many homeowners who opted to wait and see how things would go in 2021 now are putting their homes on the market in hopes of not completely missing the boat when it comes to the current housing boom. “They were not quite ready to make moves last year – and they definitely are now,” Hale said. She also noted that the number of home sellers rose for 10 of the first 11 weeks of 2022, which could lead to fewer bidding wars as inventory begins to accumulate.
The team compiled a list of markets where buyers may gain a little bit of an edge in the coming months. Some of those markets are:
Thanks to intense, cash-heavy competition in 2021, many first-time buyers with advantageous FHA, USDA, or VA loans may have a fighting chance in this market in 2022 as the numbers of offers per listing fall. Of course, the average offer count per listing is still about 5, so it’s still going to be an uphill battle.
Although Raleigh has only about three months’ worth of inventory and houses are spending an average of 9 days on market, homes priced in the “sweet spot” below $250,000 – just right for investors – are actually staying on the market a little longer than average. Because Raleigh has had a huge influx of tech workers thanks to relocations by Apple, Google, and Meta, houses in higher ranges are facing steeper competition, allowing investors and first-time buyers to edge in.
- Rochester, N.Y. & Denver, Colo.
Thanks to 10 days on market (median) in these two markets and intense competition, both are on the verge of overheating. Essentially, in today’s post-pandemic world, a market in which things look like they could potentially get to the point of a bubble bursting is the closest we can get to a buyers’ advantage in the market!