It’s not a buyer’s market. It’s not a seller’s market, either. Broker Frederick Peters called it a “broker’s market.”

It’s a market that doesn’t want to be defined. Let’s call it a non-binary housing market.

I’ll explain.

When it was a Buyers’ Market

Since mid-2022, buyers have had it pretty good—if they were carrying cash. And in New York City, boy were they. Indeed, more than 60% of all deals were all-cash. I have argued here that the smart money was buying when rates were hovering around 7%. It wasn’t a tough case to make.

New York City was unique, in that there was still abundant inventory, enough that it never became the frantic seller’s market that most cities saw, where prices still went up 2-3% this year. No, New York City has been a bit of a buyer’s market. Prices softened in the wake of rising mortgage rates, and only in the last few months has that shifted.

We strongly encouraged buyers to take advantage of this moment, and to suck it up and refinance when rates moved down. This buyers’ market has ended, for sure. If you took my advice, you should be very happy. If not, never fear, the pendulum has not swung too far—yet.

When it was a Sellers’ Market

You have to look back nearly ten years in New York City to find a sellers’ market. 2014 was likely the last real peak that we saw, excluding luxury co-ops and condominiums, which have continued to see record prices. For the rest of the resale market, prices have not recovered to that ten-year-old high watermark. We’ve been selling properties purchased in 2014-2018 that are unfortunately trading below it. There are going to be exceptions, of course. But the good news is that there’s a shimmer of appreciation in the air. And sellers are starting to feel optimistic about their prospects.

The Broker’s Market

You could call the past two years a broker’s market. We have been holding hands, circling up for serious chats, and cheerleading from the sidelines so that buyers and sellers can move forward with their lives. It’s about time, people. You can wait around forever, but I know you don’t want to. If being happy is the priority, number crunching isn’t always going to get you there. But great agents really were the difference between a dead market and a suboptimal, but transactional one. We are finishing up our best year right now, and 2023 was our second-best in terms of sales volume. Good agents won. As did smart buyers. And sellers who deployed their post-sale equity into the equities market or even the most risk-free bonds did, too. 5% returns are better than 0% returns in your house. You don’t have to be a genius to figure that one out.

But I know that buyers and sellers have been waiting for something else.

Enter the Non-Binary Housing Market

Someone asked me where the market was. A “one” meant a total buyers’ market. A “ten” meant a total sellers’ market. You could pepper in the ease of getting deals done, but in broker-speak, that only means how easy buyers are being—and that just means how easy sellers have it, anyway.

I gave it a six, because buyers are more enthusiastic about lower mortgage rates, and don’t want to miss out on opportunities today, BEFORE PRICES GO UP.

That’s why I think it’s a non-binary housing market. It’s a market that doesn’t want to be defined. Prices are still reasonable compared to ten years ago. Rates are attractive to buyers. They’re not overly greedy anymore and can find good opportunities. Sellers have the chance to sell and upgrade and not have mortgage rates be double what they were. And brokers have the chance to pull it all together. It’s one of these weird perfect storms where almost everyone can be pretty happy with the results.

Soon, sellers will get greedy again, I’m sure. And buyers will start complaining again. That “six” will become a “seven” in the rankings. But for now, enjoy this ecosystem where things can get done. It won’t last very long.

-Scott & The HRT