A Momentum Shift in The Housing Market is Causing a Re-Balancing

The Weekly Recap

Good morning and happy Friday! The Fed held rates steady again, there are more sellers for homes than buyers on the market, AMEX is making a massive investment into its Platinum card, private equity is sitting on $1 trillion worth of cash, 70,000 people have applied for the US’ $5 million golden visa program and its finally starting to feel like Rosé Season.

If you missed last weeks newsletter on What Is the FARE Act and What Does It Mean for NYC Rentals you can read that through the link.

A Momentum Shift in The Housing Market is Causing a Re-Balancing

As the housing market enters a new phase, real estate professionals are facing a subtle but important transition. Three key dynamics are now shaping the national landscape: home-price appreciation is weakening, inventory is building at a faster pace than buyer demand, and homeownership tenure is beginning to decline. These trends mark a departure from the intense post-pandemic environment and shows a more balanced, data-driven market is taking shape.

After several years of sharp increases, home-price growth is starting to lose momentum. While values remain historically elevated, the pace of appreciation has decelerated. Nationally, prices are still rising in many markets, but at a noticeably slower rate. In some cities, gains have plateaued altogether while others are even beginning to post year-over-year declines which is good news for buyers who have felt priced out.

This pricing re-alignment is being driven by affordability constraints as well as an increase of supply coming to the market. Mortgage rates, remain elevated relative to recent historical norms, which has pushed monthly payments beyond the reach of many would-be buyers. Combined high home values and limited wage growth narrowed the pool of qualified and motivated buyers.

At the same time, inventory levels are beginning to recover, with new listings increasing in many parts of the country. This growth in supply is a welcome shift for the market but is arriving faster than demand is returning in some spots. The result is a growing gap between available homes and active buyers which is not a dynamic seen in several years. This can be attributed to buyers being dissuaded by what they were seeing on the market when they were actively looking and sellers coming to market with aspirational pricing.

These trends are correlating to longer days on market and fewer multiple-offer scenarios. It’s also beginning to apply modest downward pressure on prices in some submarkets, particularly those where speculative investment or rapid appreciation drove unsustainable gains in a post-covid environment. For Sellers, this means pricing strategies must evolve.

One of the more surprising developments is the emerging decline in homeownership tenure. After years of increasing “stay-put” behavior, with owners remaining in their homes for 10+ years on average, we’re starting to see that trend reverse. A combination of lifestyle changes, remote work flexibility, and generational turnover is encouraging more frequent moves.

While this reversal is still in early stages, it has important implications. Increased mobility among owners could lead to more listings, particularly among aging homeowners looking to downsize or relocate, and younger homeowners seeking lifestyle-driven changes despite elevated mortgage rates.

Market Performance

Here are how some other indexes and asset classes have performed as of this Mornings opening bell.

NYC Market Update

Here is a view of NYC market activity over the past week.

Mortgage Rate Update

Mortgage rates moved lower again this week and reached its lowest levels for the first time in a month. More inventory is aggressively making its way into the market place giving buyers who are tired of waiting on the sidelines, ample opportunity to get into the marketplace.

News You Can Use

• The US Is Exceptional When it Comes to Rates Bloomberg

• Fed Officials Hold Rates Again, Still See Two Cuts by The End of the Year Bloomberg

• The Fed Is Just As Confused As the Rest of Us Bloomberg

• New Real Estate Math, Half a Million More Sellers than Buyers Wall Street Journal

• Trump Rips Into ‘Too Late’ Jerome Powell As the Fed Holds Rates Steady CNBC

• US Consumer Sentiment Jumps as Inflation Expectations Improve Bloomberg

• US and UK Trade Deal Finalized Reuters

• Sellers Leave Money on The Table With Privately Held Sold Listings Inman

• Private Equity Sitting on $1 Trillion MSN

• Amex Plans ‘Largest Investment Ever’ in Platinum Card Bloomberg

• Senate Passes Stablecoin Bill, A Major Victory for the Crypto World Yahoo Finance

• Over 70,000 People Have Applied for the $5 Million Investor Visa Financial Times

• Fast-Casual Food Places Conquering Midtown As Workers Return to Office NY Post

The Deep Insight

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