Are We Heading into a Balanced Market?

<article class="post-1174577 post type-post status-publish format-standard has-post-thumbnail hentry" id="post-1174577"><span class="entry-date">August 29, 2024</span><div class="entry-header center-block text-center"><h1 class="entry-title">Are We Heading into a Balanced Market?</h1><div class="shareBlock"><div class="shareTitle">Share</div><div class="shareIcons"><a aria-label="Twitter Share Link" class="twitter solid display-inline-block" data-tracking="Post,Social Post Link Clicked,Twitter" href="http://twitter.com/share?text=Are+We+Heading+into+a+Balanced+Market%3F&amp;url=https%3A%2F%2Fgilliggroup.com%2Fblog%2Fare-we-heading-into-a-balanced-market%2F" target="_blank"><span class="force-hidden">Twitter</span></a>
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</div></div><div class="post-tax post-category"><span></span><a href="../category/realtor-blog/index.html" rel="tag">Realtor Blog</a></div><div class="post-tax post-post_tag"></div></div><div class="entry-content"><div><img alt="Are We Heading into a Balanced Market? Simplifying The Market" decoding="async" loading="lazy" src="https://media.agentaprd.com/sites/222/20240829-Are-We-Heading-into-a-Balanced-Market-original.webp" style="display: block; margin-bottom: 5px; clear: both; max-width: 100%;" width=""/>
<p>If you’ve been keeping an eye on the <a href="https://www.simplifyingthemarket.com/2024/08/22/todays-biggest-housing-market-myths/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">housing market</a> over the past couple of years, you know sellers have had the upper hand. But is that going to shift now that inventory is growing? Here’s a breakdown of what you need to know.</p>
<h4><strong>What Is a Balanced Market?</strong></h4>
<p>A balanced market is generally defined as a market with about a five-to-seven-month supply of homes available for sale. In this type of market, neither buyers nor sellers have a clear advantage. <a href="https://www.simplifyingthemarket.com/2024/07/29/are-home-prices-going-to-come-down/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">Prices</a> tend to stabilize, and there’s a healthier number of <a href="https://www.simplifyingthemarket.com/2024/08/12/are-there-more-homes-for-sale-where-you-live/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">homes</a> to choose from. And after many years when sellers had all the leverage, a more balanced market would be a welcome sight for people looking to move. The question is – is that really where the market is headed?</p>
<p>After starting the year with a three-month supply of homes nationally, inventory has increased to four months. That may not sound like a lot, but it means the market is getting closer to balanced – even though it’s not quite there yet. It’s important to note <a href="https://www.simplifyingthemarket.com/2024/08/23/how-growing-inventory-benefits-todays-buyers-infographic/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">this increase</a> in inventory is not leading to an oversupply that would cause a crash. Even with the growth lately, there’s still nowhere near enough supply for that to happen.</p>
<p>The graph below uses <a href="https://cdn.nar.realtor/sites/default/files/documents/ehs-07-2024-overview-2024-08-22.pdf?_gl=1*139kxxh*_gcl_au*MTI2MzExNDg3MS4xNzIyODczNTU1" rel="noopener noreferrer" target="_blank">data</a> from the <em>National Association of Realtors</em> (NAR) to give you an idea of where inventory has been in the past, and where it’s at today:</p>
<p><a href="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240827/20240829-Months-Inventory-of-homes-for-sale-original.png" rel="noopener noreferrer" target="_blank"><img alt="No Caption Received" decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240827/20240829-Months-Inventory-of-homes-for-sale-original.png"/></a>For now, this is still seller’s market territory – it’s just not as frenzied of a seller’s market as it’s been over the past few years. As Mark Fleming, Chief Economist at <em>First American</em>, <a href="https://blog.firstam.com/economics/housing-supply-surge-improves-affordability-in-some-markets" rel="noopener noreferrer" target="_blank">says</a>:</p>
<blockquote><p><em>“The faster housing supply increases, the more affordability improves and the strength of a seller’s market wanes.”</em></p></blockquote>
<h4><strong>What This Means for You and Your Move</strong></h4>
<p>Here’s how this shift impacts you and the <a href="https://www.simplifyingthemarket.com/2024/08/16/3-reasons-to-move-in-todays-shifting-market/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">market conditions</a> you’ll face when you move. Lawrence Yun, Chief Economist at NAR, <a href="https://www.nar.realtor/magazine/real-estate-news/nar-market-is-shifting-slowly-in-buyers-favor" rel="noopener noreferrer" target="_blank">explains</a>:</p>
<blockquote><p><em>“Homes are sitting on the market a bit longer, and sellers are receiving fewer offers. More buyers are insisting on home inspections and appraisals, and inventory is definitively rising on a national basis.”</em></p></blockquote>
<p>The graphs below use the latest data from <a href="https://cdn.nar.realtor/sites/default/files/documents/2025-07-realtors-confidence-index-08-22-2024.pdf?_gl=1*1y88fzw*_gcl_au*MTI2MzExNDg3MS4xNzIyODczNTU1" rel="noopener noreferrer" target="_blank">NAR</a> and <a href="https://www.realtor.com/research/july-2024-data/" rel="noopener noreferrer" target="_blank"><em>Realtor.com</em></a> to help show examples of these changes:</p>
<p><strong><img decoding="async" src="https://files.keepingcurrentmatters.com/KeepingCurrentMatters/content/images/20240827/20240829-Shifts-happening-in-todays-market-original.png"/>Homes Are Sitting on the Market Longer: </strong>Since more homes are on the market, they’re not selling quite as fast. For buyers, this means you may have more time to find the right home. For sellers, it’s important to <a href="https://www.simplifyingthemarket.com/2024/08/21/the-number-one-mistake-sellers-are-making-overpricing-their-house/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">price your house right</a> if you want it to sell. If you don’t, buyers might choose better-priced options.</p>
<p><strong>Sellers Are Receiving Fewer Offers</strong>: As a seller, you might need to be more flexible and willing to compromise on price or terms to close the deal. For buyers, you could start to face less intense competition since you have more options to choose from.</p>
<p><strong>Fewer Buyers Are Waiving Inspections</strong>: As a buyer, you have more <a href="https://www.simplifyingthemarket.com/2024/08/06/helpful-negotiation-tactics-for-todays-housing-market/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">negotiation power</a> now. And that’s why fewer buyers are waiving <a href="https://www.simplifyingthemarket.com/2024/08/09/home-inspections-for-sellers-how-to-prepare/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">inspections</a>. For sellers, this means you need to be ready to negotiate and address repair requests to keep the sale moving forward.</p>
<h4><strong>How a Real Estate Agent Can Help</strong></h4>
<p>But this is just the national picture. The type of market you’re in is going to vary a lot based on how much inventory is available. So, lean on a local real estate agent for insight into how your area stacks up.</p>
<p>Whether you’re <a href="https://www.simplifyingthemarket.com/2024/07/24/a-newly-built-home-may-actually-be-more-budget-friendly/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">buying</a> or selling, understanding how the market is changing gives you a big advantage. Your <a href="https://www.simplifyingthemarket.com/2024/08/20/how-to-choose-a-great-local-real-estate-agent/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">agent</a> has the latest data and local insights, so you know exactly what’s happening and how to navigate it.</p>
<h3>Bottom Line</h3>
<p>The real estate market is <a href="https://www.simplifyingthemarket.com/2024/08/13/is-affordability-starting-to-improve/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">always changing</a>, and it’s important to stay informed. Whether you’re buying or <a href="https://www.simplifyingthemarket.com/2024/07/31/should-you-rent-out-or-sell-your-house/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">selling</a>, understanding this shift toward a balanced market can help. If you have any questions or need expert advice, don’t hesitate to reach out to a local real estate agent.</p>
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