After years of the U.S. housing market seeing fierce competition among buyers and a low supply of homes, change may be underway.
RE/MAX President and CEO Nick Bailey was interviewed on Fox Business’ The Claman Countdown to share where housing trends could be headed next.
“With high prices and climbing mortgage rates, is the red-hot housing market starting to show a few cracks in the foundation?” asked show host Liz Claman.
Claman shares that in May 2022, existing home sales fell to their lowest level since June 2020. But Bailey explains that this may signify the beginning of a return toward balance.
“We've had 123 consecutive months of a run up in this business,” says Bailey. “And so, the changes that we're starting to see and talk about are the reality of this market returning more to an equilibrium.”
He continues, “Demand is very high and sellers have been driving the market. I think what we're going to start seeing is [while] buyers may not be returning to the driver's seat, [they] certainly may get in the front seat here soon.”
Bailey notes the total U.S. housing inventory is currently short by almost 4 million homes – but it’s the quick turnaround time for the sale of new inventory keeping the market highly competitive.
“We really haven't had an inventory problem per se, because [real estate agents] still last year sold over 6 million homes,” he explains. “We've had a days-on-market problem for buyers, [where homes are] flying off the shelf.
“A couple of things are going to happen. We're going to have to see inventory levels increase. We're going to have to see days on market increase before we see prices stopping to rise."
Catch the Fox Business news segment for more of Bailey’s thoughts on regional specific housing trends and changes to the mortgage industry.