If you gave up on house-hunting this spring because every listing you liked went to a cash bidder and no lender could get you past 6.9%, the market you’re re-entering isn’t the one you left. First-time buyers just took 33% of existing-home sales in June, up from 30% a year ago. Fewer people were competing for the same houses. If that describes you, the door cracked open. Check the field again.
This was not supposed to happen at these prices. NAR’s June report put the median existing-home price at $440,600, an all-time record and up 1.8% year over year. Total sales dropped 2.4% from May to a 4.09 million annualized pace, with 4.6 months of inventory (NAR, July 9). Chief economist Lawrence Yun called it “a tepid housing market that is especially difficult for first-time home buyers.” Read that quote carefully. He’s right that the sticker is punishing. He’s also describing the exact set of conditions where a serious first-time buyer lands a house without three offers stacked on top.
Here’s the catch. Yun’s follow-up piece a week later, “Buyers Aren’t Rushing In,” warned that inventory growth is stalling. Total inventory sat at 1.56 million units, only 1.3% above a year ago. Sellers who don’t get their number are pulling the listing rather than cutting price (NAR, July 16). That’s not a permanent window. It’s a summer window.
Prices are still at a record. Freddie Mac’s July 23 print put the 30-year fixed back at 6.58% (Freddie Mac PMMS). Those two numbers don’t help you. What does help: fewer competing offers on the same home, sellers open to concessions (nearly half of home sales in May came with seller-paid credits, per Redfin), and lenders that would rather close your deal than let you walk. Your monthly payment isn’t lower than it was in April. Your odds of actually landing a house you can afford, at a number you can negotiate, went up.
Do this in the next two weeks. Pull your credit score today. If it’s above 740, get a written pre-approval from one lender at today’s rates on the exact loan size you’d actually take. Between 680 and 740, ask what a 30-year FHA payment looks like with 3.5% down on your target price. Then call a second lender that same week and force them to compete for you. Take the better pre-approval to Zillow or Realtor.com, filter to your metro, sort by longest days on market, and set alerts. Older listings are where sellers are already thinking about a price cut.
Ask for closing-cost help in your first offer. Half of sellers wrote that check in May. Yours will not come unless you ask.
If your only reason for buying this fall is that your lease ends August 31, and you don’t have a strong pre-approval and 3 to 5% down ready, rent short-term and come back with a real bid. Don’t force a purchase because a headline said the window opened. The window is real. The math is still the math.
Real money. The first-time buyer share hit 33% because buyers who show up prepared are the ones winning this market. Show up prepared.
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