Signs of the Times

Signs of the Times

Continuing the conversation…. as the market heads rather haltingly towards the midpoint of 2025. We’re not quite there yet but we’re close enough to say with some certainty that this year is “different.”

In fact, I’ll make it official now by saying: This is the year when everything we thought we knew about the real estate market and how it is supposed to work, will change. Change for the better? Or worse? The answer depends on which direction you approach the market from in the days ahead – buying or selling.  

We’ve spent the last decade riding the wave of the longest running, fastest accelerating, highest appreciating market anyone in these parts has ever seen. One that even managed to use the paradoxical effects of a global pandemic to add five extra years of equity onto homeowner net sheets.  

Along the way, we cruised past a series of all-time price highs while the supply of available listings sank to historical new lows, even as a slew of new digital tools gave us free reign to push the pace of listing, marketing, negotiating and closing properties to frenetic new levels. 

We’re on the other side of the inflection point now and the market is already not the same as it was. The notion that a “normal” market means houses sell in the first few days with multiple offers, for way over list, with no contingencies, fast escrows and a free two month rent back for sellers is quickly fading in the rearview mirror.

It will take a few more months before the sales data really starts to show a modest decline in home prices.  Prices are trailing indicators that reflect more fundamental battles being waged in the trenches as individual buyers and sellers jockey for position and negotiate for control. Next week we’ll take a deeper dive into the numbers. 

In the meantime, here are a few simple ways you can tell the market is shifting: Look around your neighborhood. Do you notice more of those for sale signs populating the streetscapes? Also, see if you notice more of those “flash mobs” of open house signs on the weekends congregating at busy corners.  And while you’re reading the paper, notice that the number of real estate ads is steadily increasing as more houses come on the market and take longer to sell.

This is the place everyone knew we’d come to all along –  a “turning point”.  One that’s long overdue and one that reminds us markets don’t go up forever even though it’s almost impossible to avoid getting swept up in the “irrational exuberance” when you’re sitting right in the middle of it.