The stock market is at an all-time high. The wait for rates to improve has ended. This summer’s sales volume was better than I expected given the rate environment and more listings have come to market than anticipated. Additionally, home prices continue to hold strong and will likely head in an upward trajectory as rates improve. The overall market seems much more positive than it did this time last year, but both inventory and days on market are creeping upward. Initial pricing is more important than ever, as the market is more balanced than in prior years and Buyers are more judicious.
While rates are trending down, property taxes and some homeowner’s insurance rates are headed up. This is causing mortgage escrow balances to be restructured, which can often result in a payment swing of several hundred dollars per month. Affordability (how much house you can afford for the total payment amount) continues to be challenging unless you can afford a large down payment. Despite higher-than-anticipated inventory, the overall number of houses available to purchase is still low, as people who have low locked-in interest rates are staying put.
I am still seeing grandparents moving to be closer to their kids and people moving from out of state to take advantage of Birmingham’s relatively lower cost of living and lifestyle. After studying overall market dynamics, I see Birmingham’s market as healthier than the average U.S. market. Given rates and affordability, it’s interesting that Birmingham is still seeing strong listing activity relative to other areas. Most analysts believe it is pent up demand from a soft 2023. Other than rates being higher than a few years ago, it is one of the better times to find a home than I have seen recently. Buyers and Sellers are more rational – negotiations, inspections, and appraisals are enjoying a welcome comeback into the market. It’s a great time to buy or sell.