Low Ceilings 🏠

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Low Ceilings

The real estate market is fairly unique and somewhat disconnected from other markets. Currently, the market is seeing a downturn in sales for previously owned properties. Indeed, sales of these properties fell to an all-time low in April (the slowest pace of sales since the start of COVID). According to the National Association of Retailers, existing-home sales declined 2.4% compared with March to a seasonally adjusted annualized rate of 5.61 million units. Sales were 5.9% lower than in April 2021. In terms of the broader economy: Lawrence Yun, chief economist for NAR, says that in terms of the broader economy: “We are moving back to pre-pandemic sales activity, but I expect further declines”, citing that rates are now higher than they were when these contracts were signed.

This trend contradicts the sentiment in the air, with many people still aspiring to become home buyers. It appears the state of the economy and prices are preventing those who want a home from pursuing it. This idea is reaffirmed by Danielle Hale, a chief economist at Realtor.com who said: “The number of households interested in becoming homeowners remains high, despite waning confidence that now is a good time to buy. This is especially true among younger home shoppers, who are likely to be first-time buyers and are struggling to save for a down payment as rents continue to hit records”.

What do you think of the housing market’s current state? And are you looking to buy a home? 

I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

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