F
all has officially arrived, bringing with it a fresh wave of changes in the American real estate market. As interest rates continue to decline, mortgage rates are expected to look their best in several years, making it an ideal time for people to buy. According to Seamus Nally, CEO of TurboTenant, "When mortgage rates fall, demand increases since people want to take advantage of these new rates." This surge in demand could drive real estate prices up.

    Experts predict that inventory levels will finally start to increase across the US, with the Midwest expected to see a significant surge in buying and selling. Kuba Jewgieniew, CEO and founder of Realty ONE Group, notes that "homebuyers forced to move due to life circumstances will prioritize affordability" as economic pressures ease. However, this could lead to more competition among buyers, potentially driving prices up.

    Mortgage rates may continue to drop, making homeownership more affordable for potential buyers. Don Wede, president of Heartland Funding Inc., advises keeping a close eye on interest rate changes, which could lead to more competitive pricing and bidding wars. Inventory levels might finally start to increase as homeowners who delayed selling due to economic uncertainty list their properties.

    Home prices are likely to hold steady or even increase despite the challenges in the market. Wede notes that prices typically remain high during low-inventory periods, especially if demand continues to outpace supply. Commission structure changes could also affect transactions, with buyers potentially responsible for their agent's commission. This shift could lead to more empowered negotiations and influence home values.

    The market is expected to remain competitive, even with possible drops in mortgage rates. Wede advises first-time buyers to be prepared to act quickly when finding a property they love. Three cities that might feel the flux more than others are New York City, San Antonio, Texas, and Seattle. In New York City, buyers are re-entering the market due to lower interest rates, while in San Antonio, decreased housing prices could lead to increased demand and higher prices. Seattle is expected to see big price increases due to high salaries, limited inventory, and increased purchase power from falling mortgage rates.