Market Overview
Traditionally, real estate activity slows during a holiday weekend, with a significant dip in buyer activity, showings, and pending transactions.

Interestingly, the opposite happened this Labor Day weekend: The data (not pictured above) reveals an unexpectedly strong showing. We experienced only a modest decrease in showing activity and a nearly flat decline in pending transactions. The data signals stronger-than-usual buyer engagement during the holiday weekend.

The number of for-sale homes stayed stable during August and even rose 6.6% versus August 2023. 

Inventory and Negotiating Power
The amount of available inventory has reached its highest level since 2014, and historically, it will continue to grow through September or October. 

This means buyers have more negotiating power and choices than at any point during the last decade and that homes probably will continue to experience price reductions and longer days on the market. 

Sales and Prices
The number of homes closing during August — 2,717 — dipped 2.9% compared to the previous month, suggesting a more-balanced market. The median home price declined by 0.8% to $650,000, which is slightly higher than the $646,000 median amount a year ago.

Declining Interest Rates
The decline in interest rates was a significant development in July and August. The 30-year fixed mortgage rate dropped to about 6.5%, the lowest point of the year. This factor potentially could reignite buyers’ interest during September and October, especially if the Fed cuts the lending rate later this month.

Accurate Pricing Matters
Pricing a home at or below market value is so important, instead of pricing it above market value, allowing for “wiggle room,” and dropping the price to where it should have been but then dealing with the stigma of a “stale” listing.

Here’s a repeat from the last four months: I've noticed a healthy amount of all properly priced single-family homes went under contract within their first week on the market — with some receiving multiple offers. Meanwhile, the other half often lingered on the market for 30 to 60-or-more days. Again, the proper listing price and specific location — city, zip code, or neighborhood — matter.

My Monthly Mantra
I believe Months Supply of Inventory is a true yardstick of the real estate market. A "balanced" market has at least three months and up to six months of supply available. In other words, if, starting today, no sellers were to list their home for sale, then — according to the definition of a balanced market — all the for-sale homes would sell in three to six months.

That figure was 2.7 months in August and 2.8 months in July. Thus, our supply of inventory remained much higher than it was in August 2023 (only two months), meaning we’re near a balanced market.

Tidbits

• Seller-paid concessions continue to be prevalent in many closed transactions, with a notable average amount primarily used for buyer’s closing costs or interest rate buy-downs.

• Demand for homes, as indicated by pending transactions, decreased from last month, with a slight drop of 2.9% in closed transactions.

• Average and median days on market increased, with homes taking longer to sell than in recent years. The average number of days to receive an offer was 27, up from 25 days in August 2023.

• The rate of price reductions decreased last week (not in August). 

  Note: Days on market can be skewed by how the MLS processes new-construction homes.