5 economists and real estate professionals forecast the housing market this summer

Do you want to buy a house? Here’s what pros say you might want to know this home buying season.

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Home prices have risen, as have mortgage rates (here are the lowest mortgage rates you can qualify for), and many buyers are wondering: what’s in store for us this summer? We asked economists and real estate professionals to share their thoughts and predictions.

More offers will receive price reductions

Data from real estate exchange Refin, released in May, showed that nearly one in five home sellers had reduced their price, the highest rate since October 2019. And Zillow economist Nicole Bachaud says signs are beginning to show that the market is recovering balanced. “The proportion of listings with a price drop is increasing, possibly a sign that sellers cannot be quite as ambitious in their pricing strategy as they could have been in recent months. Stock levels also continue to rise, although they are still well below pre-pandemic norms,” says Bachaud.

Property price growth will slow soon, but perhaps not as quickly as buyers looking to buy this summer would like

Seasonally, we’re at the point in the year where we tend to see peak home prices, says Danielle Hale, chief economist at Realtor.com. “There are a variety of reasons for this, including the fact that many of the homes for sale and being sold at this time of year are larger family homes,” says Hale. Additionally, she says, while list prices have accelerated or shown a faster growth rate, retail prices have stabilized or eased slightly in recent weeks. “This suggests that house prices may be at an inflection point, with signs of slower growth,” says Hale.

For his part, Greg McBride, chief financial analyst at Bankrate, says: “The market will cool off somewhat as more potential homebuyers have been priced out by rising home prices and rising mortgage rates, but even subdued demand will still outpace extremely low levels of supply. The pace of house price increases will slow, but houses will still sell for a lot more than they did six or 12 months ago, even if sellers aren’t getting the moonshot price they’re currently asking.”

And Bachaud also believes price growth will slow — but not yet. “Homes are selling at an unprecedented rate, just seven days for the typical home, and nearly half of homes are selling above their list price,” says Bachaud.

Here are the lowest mortgage rates you can qualify for.

Prepare for inventory changes

Bachaud says a more balanced market is likely to be around the corner as rising costs may keep enough potential buyers on the sidelines for inventory to begin to keep up with demand. And for his part, Steve Reich, chief operating officer at Finance of America Mortgage, says seasonality definitely comes into play, as spring and early summer tend to be the best buying windows for families who have larger homes or are looking to move because of the kids not going to school . “As a result, more stocks could come onto the market,” says Reich.

However, buyers wanting a new Bauhaus might find a challenge, says Reich: “The potential for continued inflation and higher prices across the board will likely translate into higher new home costs and make new homes more expensive to bring to market , which makes it even more difficult to find housing,” says Reich.

Buyer demand has eased

As MarketWatch recently reported, April’s pending home sales fell for the sixth straight month, thanks to higher home prices and mortgage rates. And Redfin reported that Google searches for “property for sale” in the week ended May 21 were down 13% from a year earlier. “Right now, as the market tries to settle for higher interest rate levels, buyer demand has gradually eased as consumers assess what their affordability looks like. Both buyers and sellers have stepped to the sidelines to see where the dust settles, which is fairly common during periods of high volatility and uncertainty. This is definitely a wait and see moment,” said Robert Heck, vice president of mortgages at online mortgage marketplace Morty.

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