Much like the weather, the housing market’s hottest season is summer. Buyer activity begins to accelerate in the spring and typically reaches its peak right before the end of the summer. After the kids go back to school, the air begins to cool and so does the market. Fall brings with it fewer buyers, slowing prices, and less competition for available homes.
However, newly released data shows the seasonal slowdown began earlier than usual this year. For example, according to a new release from the National Association of Realtor’s® consumer website, home prices fell 1.8 percent between July and August. The timing and size of the decline is a good indication that the summer sales season is coming to an early close.
Why did the seasonal slowdown come early this year? One explanation is that – though slowing prices and low mortgage rates are good for affordability – economic uncertainty has potential buyers and sellers feeling cautious.