04/25/2024
Is now a good time to buy a house?
(Was I correct in my predictions? [mostly])
What's really happening in the micro-economy of Oklahoma City?
The spring to summer months are having a very strange trend on home sales currently. House prices are holding strong at current and buyers have started to show up which is creating competition for the top 10% of houses in various categories (ie. the cutest remodels, the cheapest 2 beds, the best kept starter homes, the well crafted 5 beds, etc.).
So some homes are seeing offers over asking price.
However, other homes are still reducing their prices.
Why?
My theory: We have enough buyers in the higher-end market looking to buy, but are okay with waiting to get the perfect property. They aren't desperate to buy, they're looking for the right house and they're willing to pay extra for it or wait for it. Those homes that are good, not great, they're having to lower expectations.
In the lower tiers, foot traffic is down considerably yet prices are still holding as sellers aren't competing enough to feel pressure to lower prices much more than they already have.
Why?
My theory: Sellers are always the most reluctant and slowest moving aspect of the market. Many of them are excited at the prospect that their homes *had* massively increased in price and they aren't interested in letting go of that perceived equity. Also, many homes on the market at this level aren't motivated sellers. They're inheritors, flippers, or individuals with enough cash to purchase their next property without the contingency of selling out.
Bad news: Much to my surprise, the current macro data across the US is hinting that we *may* see one small rate cut this year from the Fed. In spite of a major election in November. Though if inflation continues to show strength in the summer months, that cut will likely go out the window. This will have two effects.
1) House prices may come down a bit more in late 2024 and into 2025 (this will depend on how strong the June, July, Aug. sales are as high sales will convince sellers they're still in a sellers market).
2) The need for buyers to buy will increase as more time goes on and more households are formed, more promotions are had, and more migration movers get tired of renting. This means the pop I predicted would happen at the first solid fed rate-cut could be even bigger than previously expected.
If you're a soon to be cheaper-end buyer, make lower offers if a house has been sitting. You may find someone who is getting tired of waiting out the market.
If you're a high-end buyer jumping in right now, move quick, over offer, have an agent that can get a contract done in a day not three.
If you're a seller, do your best to make sure the property is in the best possible condition. You want to bring competing offers if possible. Paint, fix broken objects, even consider smaller remodel options that would give you an edge over the property next door.
If you're sale price is over $500k absolutely consider paying for staging.
-Want a real estate agent that knows stuff? Call or text me.
(405) 255-0459
