This might be the best time to buy a home in years, depending on where you live
America’s housing market is finally starting to tip in favor of aspiring homeowners.
A new analysis from Realtor.com reveals that nearly two-thirds of the biggest housing markets in the U.S. have now moved into “balanced” or “buyer-friendly” status, while only a quarter of the major markets still favor sellers. That’s in sharp contrast to 2021, when low interest rates and a buying frenzy gave sellers the upper hand in 98% of the top U.S. housing markets.
Out of the top metros, only 26% qualify as seller’s markets right now, with a relatively large ratio of home shoppers to housing stock. Of those cities, 46% are in what Realtor.com calls a “balanced-loosening” phase, trending toward giving buyers the advantage; 16% are now solid buyer’s markets, where home shoppers have the most leverage. While most major metro areas are finally trending in favor of buyers, 12% of the top 50 metros are moving in the other direction—toward a “balanced-tightening” stage that precedes a full-blown seller’s market.
Still, regional trends look very different depending on where in the country you’re looking to buy or sell a home. The new analysis shows that nearly all housing markets favoring buyers these days are in the South, while the Midwest and Northeast have the strongest concentrations of market conditions that benefit sellers. That variation is in sharp contrast to the seller-friendly nationwide homebuying blitz of a few years ago.
“A national picture is useful, but when making a real estate decision, the local details are what really matter,” said Danielle Hale, Realtor.com chief economist. “Right now, a homebuyer in Houston or San Antonio is navigating a very different market than someone in Hartford or Milwaukee.”
A heat map of housing markets
In the report, Realtor.com depicts the housing market phases as the hands of a clock, with peak seller-friendly conditions at noon (think the COVID-era housing frenzy) and buyer-friendly conditions closer to 6 o’clock. After a seller’s market peaks, it transitions into a balanced phase before eventually cooling off into a buyer’s market, with more inventory, price cuts, and more leverage for home shoppers.
The major seller’s markets currently in their peak are the metro areas of Chicago; Indianapolis; Hartford, Connecticut; and Virginia Beach, Virginia. Southern cities including Atlanta; Austin; Jacksonville, Florida; and Nashville are all entering the early stages of a buyer’s market.
Realtor.com considers housing supply, inventory balance, market competition, pricing pressure, and price adjustments to determine what market phase a metro area is in. A market’s status as buyer- or seller-friendly offers a useful snapshot of what homebuyers are grappling with; it isn’t meant to be a perfect predictor of home prices, but it can be useful.
Housing signals like Realtor.com’s new analysis offer a glimmer of hope for would-be homebuyers who’ve been frozen out of the market, but they’re not out of the woods yet. The era of ultralow mortgage rates helped many first-time homebuyers in the early years of the pandemic, but the housing market has been off-kilter ever since. Many would-be homeowners found themselves facing impossibly high monthly payments as mortgage rates spiked, inventory dried up, and high home prices lingered.
While the housing market gridlock finally started to ease early this year, homeowners face an unpredictable spring season. With a new war in the Middle East weighing on the economic outlook, in early April mortgage rates hit their highest levels in months. Higher rates drag fresh concerns about housing affordability into the busiest homebuying phase of the year—just as many Americans were hoping to catch a break.