I
n a recent conversation with data analyst Mike Simonsen, the founder and president of Altos Research, he shed light on the current state of the housing market. As economic uncertainty lingers, Simonsen believes that homeowners are finally taking action, listing their properties for sale after years of waiting. This shift is partly driven by a growing sense among sellers that the situation will only worsen with time.

    Simonsen also weighed in on the contentious issue of private listings, which he thinks are detrimental to consumers. He likened the trend to lesser-functioning markets around the world, where brokerages prioritize their own interests over those of their clients. "It's worse for everybody except the guy who's got the listings he's not showing anybody else," Simonsen said.

    The recent uptick in listing volume, which began in March, is a promising sign that the market may be returning to its pre-pandemic pace. Inventory levels are already 30% higher than this time last year, and Simonsen suspects that two factors are driving this shift: life changes forcing sellers to act, and growing concern about the US economy.

    As consumer confidence about future employment reaches a 12-year low, some homeowners may be wondering if they should sell before things get worse. If this trend continues, Simonsen predicts that unsold inventory will return to 2019 levels by the end of 2025.

    While more inventory could translate to increased home sales, Simonsen forecasts an uptick in sales over 2024, reversing a three-year decline. However, two variables – mortgage rates and economic concerns – may impact market dynamics. If mortgage rates stabilize around 6.5-6.6%, Simonsen believes this will lead to growth. But if the economy continues to weigh on buyers' minds, it could slow down the market even with declining rates.