With rising costs everywhere, we’re hearing a lot of people asking, “Is the housing market slowing down?”
By comparison to the past few years, yes, it is.
But that’s not necessarily a bad thing. Because for the past few years it’s been speeding along like a runaway freight train.
So, in reality, any slow down that’s happening is actually stabilizing the housing market.
Here’s why it feels like the housing market might be slowing down right now …
Mortgage rates are rising. They’ve gone from around 3%-4% at the beginning of 2022 to around 6% now. But to put that in perspective, according to Freddie Mac, the average in 2002 was 6.5%. The average was 8.4% in 1992, and 16% in 1982.
Higher mortgage rates mean you may qualify for a slightly lower mortgage loan amount now than you would have last year. Higher mortgage rates may be causing some buyers to be more cautious, but they are still buying.
And while they are higher than last year or even the beginning of this one, mortgage rates are still at the low end of what they’ve been historically.
Homes Sold Recently
Another indicator of the housing market slowing down would be homes sold recently. Redfin reports 388 homes sold in Fresno in July 2022, down 26.5% from the 528 sold in July 2021. But looking at the historical peaks and valleys of numbers of home sold monthly as shown in this graph from Redfin, that’s not too concerning.
It’s normal to have ups and downs, so it’s too early to say if or for how long this downward trend will continue.
Time on Market
Opposite of slowing down, homes in Fresno County are selling faster and spending less time on the market this year than a year ago. According to Rocket Homes, the average listing age in August 2022 was 60 days, compared to 95 days in August 2021. That’s 37.1% fewer days on the market.
Median Sales Price
Home prices aren’t going down, either. Realtor.com reports that the median sold home price in Fresno in August 2022 was $365,000. It was $362,000 in August 2021. And as you can see in this graph from Realtor.com, while there are certainly some ups and downs, the values of homes are steadily rising.
Normal Seasonal Fluctuation
Most experts agree that it’s “normal” for the housing market to slow down a bit in the fall. Or at least there’s been a historical trend in that direction. So at least some of the current slowing down of the housing market can be considered part of the natural cycle of things.
Are You Looking to Buy or Sell a Home Right Now?
While there are some signs that the housing market may be slowing down, now is still a very good time to buy or sell a home.
But it’s always best to talk to a real estate professional about your particular situation to get additional guidance specific to you.