As we gear into back-to-school mode, two things always hit me:
- How is it already this late in the year?
- This is one of those times of year when Real Estate hits a lull.
It makes sense if you think about it -- This is a local Real Estate market that's governed largely by demand for certain schools. Therefore, our school schedule governs a large part of the market.
We typically see Real Estate activity trail off in mid-late July as most Buyer and Sellers' attention shifts to getting settled for school at the beginning of August.
Buyers usually take their foot off the gas pedal around now, and we have a less aggressive Buyer pool, which often leads to homes stacking up on the market. Take a look at our annual inventory in Williamson County, for example. This chart compares the amount of local homes actively For Sale in 4 recent years:
The
red line is 2019 -- our last "normal" year in Real Estate. It was apparently also the last year that we had plenty of inventory.
(Though at the time, I remember everyone complaining about there not being enough homes on the market!)In most normal years, inventory reaches its highest level of the year in June.
You can see by the green line that 2024 is the first year that we are mirroring pre-pandemic "normal" patterns in Real Estate again.
As of June, we have hit our highest level of inventory of the year, though we're still about a third less of what we had on market in June 2019. Still, it's refreshing to see a return to consistency. This year's pattern represents certainty and a return to a form of normalcy.
Our blue line of 2023 looks like we really gave it a good try to be normal last year, and almost made it -- but not quite. It was a struggle, but the best shot we'd had at normalcy again until this year.
I've kept the black line of 2022 on this graph just for perspective though may roll it off at the end of the year, just because it was such a freak year. But the value of the black line is showing we still haven't had as high of inventory these past two years as what we had in that last half of 2021. We started the year in that crazy high-demand market (hence the low inventory), and you can see the change in inventory levels the minute Russia invaded Ukraine and mortgage interest rates went up. Local Buyers don't like higher interest rates or economic uncertainty -- even on a global level.
Politics have a Place
The current Presidential election will undoubtedly shape this chart -- and most others. It would have regardless of the events of the past three weeks. However, current events will likely just make the political imprint even more pronounced. (See Buyers don't like higher interest rates or economic uncertainty.)
This may sound like politics breed uncertainty -- and most Buyers feel that way. But when you look back at past Presidential election cycles, mortgage interest rates typically go down before the election, and home prices typically continue to go up after the election, regardless of who wins. I have more details on this in my
June 2024 blog post.
True to form, our mortgage interest rates lately have dropped to the lowest they've been since March with many products sitting comfortably throughout the 6-7% brackets. They will likely drop more as we approach November. Reach out to your favorite Lender to see where you would qualify and which product would be the best for you. If you need a referral, I work with some great Lenders and can share with you.
Our local home prices continue to be higher this year than they've ever been. In Williamson County, we saw a reduced median sales price from May to June BUT in all fairness, May blew all previous home sales prices out of the water. June's median sales price is still higher than any other price in 2023.
So even if we experience another drop in home prices, which is typical for this time of year, it would be a) expected and b) likely not enough to dip below the prices we've seen the past 2 years. In fact, past years show our home prices typically ending the year higher than where they started each year. And then starting the next year higher than where they ended the previous year.
Knowing all of this, what do you expect would happen with home prices, inventory and activity in Real Estate after the election? (hint: If these graph don't show you, the answer is in the aforementioned blog post!)
The reason I drive this point home so much is because we have a lot of lower-budget clients right now wanting to move. They're waiting for a break in something -- mortgage interest rates or home prices. But it's not likely that break will come after the election. To channel Warren Buffett:
"The time to get interested is when no one else is."
What's Ahead
In a normal cyclical market, it usually takes us about a month to get back in the swing of things with school, then our next push in the Real Estate market kicks in around Labor Day. We typically see more Buyer demand through September and October as activity and prices continue to increase through to the New Year.
The most important thing to remember is to stay focused on your own personal goals. National news stories about Real Estate don't always reflect what's happening locally. And P E R S P E C T I V E can go a long way in helping to stay focused (and not afraid!).
We have enough to worry about with school starting again. Let the Nash South Homes Team make it easier for you to get moving!
Thinking of moving? Need a plan tailored to your needs? I'd love to help you. I'm a Franklin resident and a Multi-Platinum Award-Winning Williamson County REALTOR ranking in the top 1.5% of agents locally. I am a top producer within Benchmark Realty, the largest brokerage in Tennessee and among the largest in the country. My continuing education includes several designations and my experience keeps me up-to-date with fast-changing market trends. I am a Million-Dollar GUILD Member of the Luxury Home Marketing Institute, my market insights are regularly featured in broadcast media, and my success planted me on the front page of a December 2021 Nashville-area Magazine. But most importantly, I specialize in helping my friends and neighbors buy and sell homes. Why look further when you've got a friend and neighbor who is among the best in the business!
