The change in real estate commission rules may discourage some home buyers, but there is one thing that could give them hope. After years of a seller’s market, buyers are moving to the driver’s seat.
Well, if not the driver’s seat, at least they’re in the front seat, according to real estate marketplace Zillow.
Zillow’s latest Market Report found that competition for homes and price appreciation tapered off faster than normal in July as potential buyers stayed away. But if they want to reap the benefits, timing may be important.
If mortgage rates continue to go down, it could draw more buyers back to the market, supporting higher home prices.
"If this relief from mortgage rates continues, we should see more buyers restarting their hunt for a home," said Zillow Chief Economist Skylar Olsen.
"But although rate lock among homeowners is easing, they probably won't be as motivated to jump back into the market and sell. With housing inventory still scarce, this improved affordability picture could reignite competition and sales as we head into the fall, or at least delay the usual post-summer cooldown."
But in July, Zillow found that sellers gave up a lot of their advantage over buyers. The Zillow market heat index moved into neutral territory for the first time since December, suggesting a more even playing field between buyers and sellers.
Where buyers are gaining strength
Among major markets, Denver, Pittsburgh, Indianapolis and Louisville moved into neutral territory after being strong seller's markets. Orlando tipped in favor of buyers like the rest of the big Florida metros.
One of the biggest changes in July was time on the market. Homes took a week longer to go under contract than a year earlier. True, listings went under contract five days faster than in 2019, but Zillow calls it a a sign that buyers were much less eager to commit.
However, the advantage for buyers could be short-lived. Zillow said the cooling competition and price slowdown could quickly become a thing of the past if mortgage rates hold steady at their present level, or even dipping further.