The housing market is basically going into hibernation

The housing market has been through a lot in the past few months. First there was the news that home sales were down. Then there were the comments from the Federal Reserve that they may cut their key interest rate. Those two factors have led many to believe that the housing market is in trouble.

According to Daryl Fairweather Redfin Chief Economist Homebuyer budgets have flattened indicating price growth has peaked meanwhile buyer and seller activity have slowed down.
Also, Lawrence Yun Chief Economist at NAR said that home sales have recently been trending down towards 2019 figures. Sales could fall even further with some inventory sitting on the market for more than a month like in the pre-pandemic days. So what does this mean for the housing market going forward? Well, it means that the current trends are likely to continue, at least until consumer price inflation tops out and starts to fall. Once that happens, mortgage rates will stabilize or even decline a bit. But until that happens, the housing market is likely to go into hibernation.

The housing market is following the lead of other markets, such as crypto and stocks, which have gone through a bloodbath. In the case of real estate, this means that inventory has piled up on the market, which is reminiscent of the pre-pandemic days, when homes sat on the market for months without buyers.

The biggest names in U.S. real estate —Redfin and Compass— announced mass layoffs in another sign that slowing demand is hitting the sector. One job cuts at Compass, a large real estate brokerage, will result in the elimination of more than 100 jobs, with the majority of them coming from its corporate and back office staff, according to a press release. Another job cuts at Redfin, a large real estate brokerage, will result in the elimination of more than 200 jobs, with the majority of them coming from its corporate and back office staff, according to a press release. Both companies emphasized that the decision to eliminate jobs was based on strategic priorities and will not impact the customer experience.

Perhaps now is a good time to reassess your investment strategy in the housing market. Flipeer is a new AI-powered real estate platform that provides you with insights, projections, and suggestions to help you better understand the housing market and make smarter decisions, enabling you to make better use of your real estate time and money. Learn more about Flipeer: www.flipeer.com

Paul Burgs Written by:

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