Housing Market 2023: 4 Reasons This Fall Could Be a ‘Sweet Spot’ For Homebuyers
Written by
Andrew Lisa
Edited by
Ashleigh Ray
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In the real estate year of 2023, sellers held all the cards. Expensive loans, low inventory, high prices and stiff competition shackled buyers throughout.
But 2023 isn’t over, and the balance of power appears to be shifting once again.
“As we approach the fall season, the real estate market is showing signs of cooling down,” said real estate investor Linda Schroder of Cash for Houses. “Real estate experts identify several factors contributing to the shift, including a slowdown in demand, more homes listed for sale,and sellers cutting asking prices.”
Sellers still have their thumbs on the scale, but if your budget can tolerate 7.5% interest, fall is shaping up to be a sweet spot for buyers in an otherwise sour year.
Sellers — a Lot of Sellers — Are Lowering Their Asking Prices
The market cools with the weather every fall when the kids return to school and the summer real estate crush subsides. But it’s happening this year at an unusually brisk pace — and falling prices are the proof.
“A noticeable sign of the market leaning toward buyers is the uptick in listings that have revised their asking prices,” said Ryan Fitzgerald, a Realtor Magazine 30 Under 30 recipient and founder of Raleigh Realty. “This past September, 17.2% of listings opted to decrease their prices.”
And that striking number is not a one-month anomaly.
“In August, over one in four homes had a price cut, which is up from one in five during the same period last year,” said Schroder.
Motivated sellers willing to make price concessions spells good news for buyers.
“This trend indicates that sellers are more open to discussions and ready to meet potential buyers halfway,” said Fitzgerald. “It creates a more accommodating environment for those keen on buying.”
Once-Ascending Home Values Are Flat (Or Close to It)
The fact that more than 17% of sellers reduced their list prices is a good sign for buyers, but it also means four out of five either raised theirs or left them unchanged.
The true cause for optimism is that the market as a whole has slammed the brakes on the runaway double-digit increases that defined 2021 and 2022.
“The sharp rise in home prices we observed in the past seems to be taking a breather, with an increase of just 0.4% compared to last year,” said Fitzgerald.
Fitzgerald’s numbers mirror Realtor.com data in showing the national median home value was $430,000 in September. That’s down from $435,000 in August and only a hair over this time last year.
“For buyers, this easing off hints at potentially escaping the soaring prices that dominated earlier periods.”
Supply is Creeping Back Toward a Balance With Demand
The most important factor is supply and demand, an equation that has been out of balance throughout the year — but there’s finally at least some reason for optimism there, as well.
According to Zillow, August saw “an unusual month-over-month increase in new listings” that reduced the year-over-year deficit by roughly half from its July gap.
“There are more new listings hitting the market, which is good news for buyers, as they have more options to choose from,” said Schroder. “The number of homes for sale increased for the third consecutive month in August, surpassing the typical summer slowdown in home inventory.”
While there still aren’t nearly enough houses to go around, fewer buyers are competing to outbid each other.
“One of the main reasons for the cool-down is a slowdown in demand,” said Schroder. “A combination of factors such as higher mortgage rates, rising home prices, and fewer international buyers has led to a decrease in demand for homes. This means prospective buyers have less competition, which could help them score a better deal.”
It’s Not Perfect, but It’s Better Than It’s Been in a Long Time
In most markets, the field is still tilted in favor of sellers, but if you’re a buyer who suffered disappointments in the spring and summer busy season, now might be the time to get back out there.
“Market analysts foresee a promising fall season, projecting an 8% surge in home sales, along with the subtle price increment mentioned earlier,” said Fitzgerald. “This combination could make the market more approachable for aspiring buyers. While certain hurdles remain, this autumn is hinting at a more hopeful horizon for would-be homebuyers. Be it sellers recalibrating their hopes or the market responding to generational influences, there’s a palpable shift that seems to benefit those with purchasing intentions.”
That doesn’t mean you should expect an easy go of it.
“Despite the cooling market, buyers still need to act quickly,” said Schroder. “They should communicate with agents, obtain pre-approval and stay on top of the market. Even if the market is slowing down, potential buyers still have to compete with each other to secure good listings. To sum up, current market conditions benefit buyers with lower demand, a growing inventory and sellers who are willing to negotiate lower prices. Buyers who act fast and are well-prepared can take advantage of these favorable circumstances and find their dream home at a good price this fall.”
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