What has already happened?
It is now mid-December in Indianapolis. The circle of lights is lit, and the ice scrapers are making their begrudging way out. And that means shifting of the market.
Typically, the winter indicates a “cooling” of the marketplace, through decreased buyer demand and less overall activity, creating a weaker housing economy in the short-run. However, as you can see on the graph below, 99% of the time, the market bounces back by Spring. In my world, as I like to say, Home-buyers are active in the warmer months, while Investors go after discounted deals in the colder months, when there is less activity.
Interestingly enough, we are seeing one of the most active early winter seasons in a while. That’s because the market is relatively favoring buyers right now, and rates have slipped downwards for the first time in a while. It’s actually a phenomenal time right now to buy a home. Here’s why:
- Less Competition than 2022
- Rates Lower than Mid-2023
- More Options for Less $$$!
Side-lined capital & buyer-demand will return
Everything right now is rate-dependent.
The minute we see rates drop sub-6, there will be millions of buyer’s nationwide making their way back into the market. 2024 is going to look a lot like 2019-2020; a strong seller’s market with strong appreciation. It will likely not be as whacky as 2021 or 2022, due to rates still being higher than quantitative easing numbers in the 2’s & 3’s. The market will shift back in favor of seller’s by late February / March, in time for Spring showers & flowers.
All of this is due to the fact that at the current moment most folks have put their next purchase on hold. Millions of individuals and families sidelined, tail between their legs, estranged from the market due to 8% rates and less inventory…
2023 did us all dirty, and in my world, realtors across the board had down years. Many called it quits.
The end of the tunnel is nigh. Unfortunately for many entering back into the market, that will mean higher prices, multiple offers, appraisal gaps the whole shebang… Less of a deal. Back to the same ole’ routine we’ve seen.
The good news is, the early adopters are already making moves now. Christmastime this year is truly “lit”.
Don’t be surprised to see that median price jerk up to the right by February / March.
Below, notice days on market. Up 46%! Seller’s are getting scared…
Takeaways & Opportunities
To be an early adopter in this market here’s what I’d be doing:
- If it’s a first home or the next investment property, start gearing up a little early. Make those introductory calls; get that pre-approval; set up that property search.
- If it’s a home trade, I’d plan to sell the current home January-March and buy the new one ideally in that same window. You’ll be paying a high premium by waiting to buy past April, when our market will be red-hot in 2024.
- If you are a renter or new to the marketplace in general, now is the time to set up a consultation. A real estate professional is like a medical professional. Who do you go to when you’re sick — a Doctor. The same is true when you aren’t sure where to go in real estate matters. Go to someone who’s job it is to be right about these matters, on a daily basis.
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Roots Realty Co. sold $10M worth of real estate in 2023. We specialize in helping first-time buyers, transitioning, upward families, and those looking to build their networth through real estate.
To book an introductory call use the link below:
Or,
Download Root’s Realty Co. buyer / investor guide
Cheers,
Tyler
