Home Sales - Summer Home Sales "Cool Down" for the Fall Season - Buyer's Opportunity?

Home Sales - Summer Sales "Cool Down" for the Fall Season 

Is this the Opportunity Buyers have been Waiting for?

While new-home sales were up after taking a previous dip, other home sales cooled off just in time for Fall.  Is this the time to go shopping for a home while the competition has also cooled down?

Make you plan to achieve your real estate goals
- Plan on buying a home or investment property?

What Has Changed?

First, this is typical if one looks to a chart comparing home sales in the Spring and Summer with home sales in the Fall and Winter.  Kids are back in school and parents are traditionally less likely to move after school starts.

Also mortgage rates jumped up over 1%, which many buyers are going to have to sit back and digest that the price range they have been researching just got more expensive with higher monthly payments because of the higher rates.

Some are saying that prices have increased too quickly and need to cool off.  Real estate is different for every area.  Some areas of the nation have only begun to experience a rebound in prices.  Others have and will likely continue to increase in price.

Talk of a Real Estate Bubble.

Experts have noted that if the media reports an increase in prices, people respond with rumors of a bubble.  But if prices moderate or experience one month of a decrease, some fear the end of the rebound.

These rumors of a bubble, coupled with the apparent long-term upward trend of rates and prices are what continues to motivate sellers to sell and buyers to get back into the real estate market.

Bottom Line.

In summary, some of the reasons we are noting for slowing of the home sales and price appreciation in some cities, as the Fall season returns, are:

1. The end of the Spring and Summer selling season,
2. The low number of homes on the market is contributing to a reduction of sales in most desirable areas,
3. The recent increase in mortgage interest rates, and
4. The increase of home prices have caused some buyers to pause and adjust to the upward trend of prices and rates

Interest Rates Increased
from their record low in Nov. 2012
to approx. 4.5%

The reasons, on the other hand, for expecting prices to continue rising include:

1. The historically low interest rates, despite the upward tick,
2. The low inventory of homes for sale because sellers are waiting to achieve more equity before selling, and
3. The pent-up buying energy of those who have been waiting on the fence for some 5+ years to buy a home.

Less Competition and Sellers Willing to Negotiate.

When home sales cool down, so does the competition from other buyers.  With competition, comes aggressive price increases by sellers and aggressive price bidding by buyers.

A cooler market sometimes results in price reductions and sellers more willing to negotiate with buyers who continue to make offers.  Could this be the window of opportunity some hoping to buy are waiting for?

See the related article from the National Association of Realtors - New-Home Sales Up, Pending Sales Lag

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Mark Harbaugh, J.D. has been a licensed REALTOR® in California since 1998.  He is a real estate Broker, holds a Bachelors Degree and a Law Degree.

Since 1998, Mark has been providing expert representation to buyers and sellers of homes, condos, multi-unit properties and multi-million dollar estates. 


His clients include friends - old and new - colleagues, professional football and basketball players, original founders of Fortune 500 companies and other high-profile personalities, who value their privacy and anonymity.  Mark has also consulted Nationally and Internationally with many interested in buying and selling real estate.

Mark can be reached at 619-246-2860.

Email: markonthemark@gmail.com

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