Real estate experts believe the housing market could be unseasonably hot this winter, with above-normal levels of home buying activity.
Lawrence Yun, chief economist of the National Association of Realtors, said he fully expects sales activity this winter to be stronger than compared to past years. “This winter there will be more sales compared to pre-pandemic winters going back all the way to 2006,” he told realtor.com.
Yun said he expects momentum that has picked up over the summer months to carry through during the colder seasons. He noted homes have been selling far faster than they normally do from March to October.
It’s an opinion that other real estate experts share
“Although there are fewer buyers in the winter months than in the competitive spring and summer period, all signs suggest that housing demand remains high,” said realtor.com chief economist Danielle Hale.
At the same time, inventories of for sale homes remain tight. According to NAR data, the inventory of unsold homes fell 12% in October compared to a year ago. The limited supply of homes for sale has plagued real estate markets across the U.S. for many months now. Combined with strong demand, it means buyers have very few options to choose from and face strong competition for them.
NAR data shows homes are selling fast too, with 82% of listings sold within the first 30 days on the market in October.
“Many sellers should not feel the need to wait until spring, especially in high-demand areas,” said Kelly Mangold, principal at RCLCO Real Estate Consulting.
Another factor to be aware of it that buyers may feel there’s a need to move quickly to lock in historically low mortgage rates before an expected rise. The 30-year fixed-rate mortgage averaged 3.1% last week, according to Freddie Mac. However, the NAR has said rates are expected to increase to around 3.5% by the middle of next year.
Meanwhile, stalling home price growth may encourage buyers too.
“The days of fast price gains are over,” Yun said. “There will be a few pockets of the market where bidding wars do occur, but sellers should expect much less than what was occurring in the past 12 months. Home prices generally will be higher compared to one year ago, but maybe a bit lower compared to what occurred in the summer.”