Is San Francisco Heading Toward a Balanced Real Estate Market?
If you've been watching the real estate market over the past few years, you know that sellers have had the upper hand. But with inventory growing, is that starting to change? Here’s a breakdown of what you need to know about where the market might be headed.
What Is a Balanced Market?
A balanced market typically occurs when there’s a five-to-seven-month supply of homes available for sale. In this type of market, neither buyers nor sellers have a clear advantage. Prices tend to stabilize, and there are more homes to choose from. After several years of seller dominance, a more balanced market could offer relief to potential buyers.
But is the housing market actually moving in that direction?
At the start of this year, the national housing market had a three-month supply of homes. Recently, inventory has increased to four months. While that may not seem like much, it signals a shift towards a more balanced market—although we’re not there just yet. It’s important to note that this rise in inventory doesn’t indicate an oversupply that would trigger a market crash. We’re still far from having an excessive number of homes for sale.
Check out data from the National Association of Realtors (NAR) to understand where inventory levels have been and where they stand today.
Still a Seller’s Market—But Less Frenzied
Although the housing market remains a seller's market, it’s not as competitive as it was during the pandemic. According to Mark Fleming, Chief Economist at First American, “The faster housing supply increases, the more affordability improves, and the strength of a seller’s market wanes.”
This gradual shift can have a big impact on both buyers and sellers.
What Does This Mean for You?
The slight rise in inventory is changing the landscape for both buyers and sellers. Here’s what to expect:
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Homes Are Staying on the Market Longer: With more homes available, properties aren't selling as quickly as they used to. For buyers, this means you may have more time to find the right home. For sellers, it’s essential to price your home competitively to attract buyers, as they now have more options to choose from.
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Sellers Are Receiving Fewer Offers: As a seller, you may need to be more flexible with your price or terms. For buyers, you could see less competition, making it easier to negotiate the best deal.
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Fewer Buyers Are Waiving Inspections: Buyers now have more leverage and are less likely to waive home inspections. Sellers should be prepared to negotiate repair requests to keep deals moving forward.
How a Real Estate Agent Can Help
While this is the national trend, your local market could differ depending on how much inventory is available. That’s why it’s crucial to work with a knowledgeable real estate agent who has insight into the specifics of your area. Agents can provide you with the latest data and trends, so you know how to navigate the market—whether you're buying or selling.
Check out Realtor.com for more up-to-date listings and data specific to your region.
The real estate market is constantly evolving. While we may not be in a fully balanced market yet, we are getting closer. Understanding these changes will give you an advantage whether you’re buying or selling. For more information or personalized advice, reach out to a trusted local real estate agent today.
MAKE YOUR SAN FRANCISCO REAL ESTATE DREAMS A REALITY
When it comes to buying or selling in areas like San Francisco (Marina, Pacific Heights, Cow Hollow), Charles Jacob is your trusted partner. With expert market knowledge and a commitment to exceptional service, he can help you find answers to all your questions. Get in touch with Charles Jacob today to step into the exciting San Francisco market.
