Sellers are going to get multiple offers on their home
The days of a dozen offers on every home listed are over. This does not mean that a home will not get multiple offers, but the belief that every home WILL get multiple offers should definitely be over. Buying power has gone down in recent months thanks to interest rates, so buyers don't have the financial leg room to offer tens of thousands of dollars over ask to secure their home.
Sellers think they can overprice their home
Six months ago, sellers could push the envelope in their pricing. Interest rates and supply were at an all time low. Today, even though supply is still considered extremely low, interest rates have more than doubled, which has a put a damper on what people can afford. In addition to that, buyers are starting to put contingencies in their offer, which often times affects the final sale price of the home.
Buyers waiting for the housing market to crash
I'm sorry to say but the market is not going to crash. Supply is still extremely low and banks have much higher standards for mortgages applications. Combine these two factors together and you have a stable housing market with no signs of a crash. There is definitely a slowing happening and homes are not rising in value as quickly and as much as they had been in the past few years, but there is no crash in sight.
Buyers waiting for interest rates to do down
As much as I want interest rates to go down, there are no signs of rates dropping as low as they were in the spring. In fact, rates may still rise a bit before stabilizing. Inflation is still on the rise which means so rates will be too. Once the rate of inflation slows, we may see a drop in rates, but nothing like we've seen recently. If you look at historical data, (the graph below) you'll see that rates have averaged between 6-7 percent since the 1970s. So even though it SEEMS like rates are super high, they are really at an average place.
Final thoughts: I'm so happy the days of 2% interest rates and homes selling for 50,000 above ask are over. Buyers finally have a say in the matter and everyone is feeling better about the home buying process. I always get asked when is the best time to buy a house. My response? When you have a stable job and can handle the responsibility of a home is when the best time to buy a house. If you try to guess the market you'll end up disappointed. Don't try to guess the market. Educate yourself, have your finances in order, and find a good realtor so when the time comes and you find your dream home, you'll be ready.