It’s been a seller’s market in residential real estate for more than a year now. That’s fantastic for homeowners, and for the U.S. economy overall, but let’s get real: It creates a challenging environment for people who are trying to buy their first home. Fear not, first-time home buyers! Things are going to get better—soon.
But in the second half of the year, the market is expected to shift toward more of a balance as more sellers – motivated by higher home prices – put their homes on the market, alleviating the inventory shortage. This will help provide buyers with more choices of homes to buy as well as likely soften the speed at which home prices are rising.
For potential first-time home buyers, the housing market will soon be more inviting, writes Jonathan Smoke, realtor.com®’s chief economist, in recent commentary.
“Combined with a temporary reprieve from rising mortgage rates and slightly easier access to credit, buyers should find it easier to purchase a home in the months ahead,” Smoke says.
For-sale listings have risen, on average, 4.5 percent over the past three months, realtor.com® notes. Also, new construction is finally stepping up to relieve inventory pressure too, with single-family permits up 9 percent year to date over last year.
What’s more, it’s getting easier to get a mortgage. Mortgage credit availability was 5 percent higher in June than a year ago, according to the Mortgage Bankers Association.
“The upcoming change of season should favor you first-time buyers, assuming you are flexible about timing and can find a home that fits your needs,” Smoke notes. “Families with school-age children are far less likely to compete for homes on the market after the beginning of the school year, which for many is in August. While inventory levels will also be lower due to the season in most areas of the country, the fall could turn into a great time to buy.”