As a residential broker, part of my job is to look at the market and report back to buyers and sellers.
Take a view of the market, be the expert.
I gather information, speak to brokers, get a feeling of the current psychology of the marketplace.
I’m reading the WSJ and NYT like everyone else about hedge funds being raided for insider information- and all I can think about is my cocktail party conversation.
“How’s the market?” This is the question that helps people determine whether the timing is good to buy or sell.
Certainly this info gathering is what each of us does when considering a sale/purchase.
So the anecdotal and data-driven are both useful, and I would like to provide you with both.
Most of the former I’ll lay out here, and leave the data to BHS’s chief economist Gregory Heym.
However, my team and I track all inquiries into our properties, how many showings we’re doing week-to-week, how many properties we are viewing with buyers, and so forth.
Buyer activity has picked up substantially in the last month.
I believe that buyers are preparing to make their moves.
The market has been relatively flat over the last few months.
During that time, a few things have happened:
1) Sales have slowed down a little bit
2) Rates have begun to creep up
3) The stock market has begun to move up
4) Inventory is significantly down
Taking a look at the last year, it appears to me that the sales before the summer were done by those who felt the market wasn’t going any further down, and that rates were favorable to lock in a sale (trade, whatever you want to call it).
As soon as those buyers closed their deals, a glut of buyers on the sidelines has been growing- simply viewing properties, watching and waiting.
Meanwhile, the stock market has improved, and mortgage rates along with it.
Essentially, rates seem not to be impacting the market.
While there was a strong push earlier in the year for refis and those who felt rates would help them achieve their goal,
most others felt no pressure to decide.
Meanwhile, almost all well-priced property
has been absorbed.
I believe we’ll see a good amount of well-priced units hit the market after the new year, and buyers will react positively.
I could even see pricing begin to improve for sellers.
As rates have gone up, equities have most improved- one could argue that buying power remains equivalent.
The job market has improved substantially.
None of this takes into acct the impact of bonuses, which, combined a sustained confidence in the economy, is a wild card.
This could drive the 1-2 br market which has lagged for a little while.
We may be seeing a bottom- I’d find it hard to see it getting any lower.
There are other details, which I’ll keep my eye on:
mortgage contingencies, lender restrictions, and such- more to come in the new year on the market.