The leaves are changing, the air is turning crisp, and the spring and summer home buying season is fading. Although the other seasons typically get all the housing market hype, homebuyers might find themselves in an unexpectedly advantageous position this fall.
According to a recent report from Realtor.com, the coming weeks could present a perfect storm of conditions for those looking to purchase a home right now. Let’s dive into why early October might just be the golden hour for homebuyers in 2024 (relatively speaking).
Why fall is a smart time to buy a home
Realtor.com’s analysis pinpoints the week of Sept. 29 to Oct. 5 as the ideal time for home purchases this fall. As the report notes, the housing market has been relatively slow the past few years, with high home prices and mortgage rates limiting buyer demand.
This period is expected to offer a unique combination of favorable factors: Easing mortgage rates, increasing inventory, and decreased competition. As the heightened activity of the spring and summer buying seasons fades, these elements might converge to create a more favorable buyer’s market across the country.
Easing mortgage rates
One of the most significant advantages for current buyers is the trend in mortgage rates. After reaching bouncing around the 7% mark throughout 2023 and earlier this year, rates have been on a steady decline as of late. Although this week’s decline was slight, the 30-year fixed-rate mortgage trended down to its lowest level in two years. According to the most recent data from Freddie Mac, the average mortgage rate now stands at around 6%, a far cry from the 8% average they reached in summer 2023.
This downward trend in mortgage rates translates to potentially significant savings for buyers over the life of their loans. Even a fraction of a percentage point can make a substantial difference in monthly payments and overall interest paid.
Seasonal shifts in the housing market
Understanding the cyclical nature of the housing market is key to appreciating why fall, particularly early October, presents such an opportunity. Spring and summer are peak buying seasons, with high competition among buyers and potentially inflated prices due to demand. In fall, there’s an off-peak advantage: Sales activity begins to slow, meaning there’s reduced competition for available homes.
According to Money.com, buyer demand is 29.5% lower during the first week of October than during the peak season, and 14% lower than the average week. Combine this with increased active listings, and you’re in a sweet spot. In fact, the Realtor.com report explains how active listing inventory has picked up rather significantly compared with last year: “The first week in October might see up to 37% more active listings than at the start of the year…Buyers are poised to save over $14,000 during this week compared with the summer peak for a median-priced home of $445,000.”
That said, at the national level, listing activity and sales volume are still much lower than they were before the pandemic.
What this means for you as a home buyer
The combination of seasonal trends and current market conditions creates several advantages for fall homebuyers:
-
More inventory. As the market cools, there’s often an increase in available homes. This gives buyers more options and reduces the pressure to make quick decisions.
-
Potentially lower home prices. Right now property values are high, and have been rising steadily for years. But with decreased demand in the fall, sellers may at least be more willing to negotiate on price. This is especially true for homes that have been on the market since summer.
-
Price cuts. Realtor.com’s report suggests we might see more frequent and significant price reductions during this period.
-
Slower pace. Without the frenzy of peak season, buyers can take more time to consider their options and make informed decisions.
-
Less competition. Fewer buyers in the market means less likelihood of bidding wars and better chances of having offers accepted.
The bottom line
While the housing market can be unpredictable, the data suggests that early October 2024 could be an exceptionally good time for prospective homebuyers, relative to recent conditions. However, it’s important to remember that real estate markets can vary significantly by location. While these national trends are promising, buyers should always consult with local real estate professionals to understand the specific conditions in their target areas.
And for those who have been waiting for the right moment to enter the housing market, the coming weeks might just be the window of opportunity you’ve been looking for. With careful planning and the right guidance, you could find yourself settling into your new home before the holiday season arrives. If you’re interested in how other people are navigating the housing market for the first time—or want to share your story—check out my “How I Bought My First Home” series here.
