M
ore homes are entering the market, and buyers are taking advantage of the increased inventory. Existing-home sales rose 2% in July from the previous month and surpassed last year's pace, according to the National Association of REALTORS. The current inventory is at its highest level since May 2020, giving homebuyers more negotiating power.

    Home prices are moderating, with a median existing-home price of $422,400 in July, representing only a 0.2% increase from last year. Lawrence Yun, NAR's chief economist, notes that wage growth is now outpacing home price growth, making housing more affordable and boosting sales.

    While some markets are experiencing price adjustments, sellers are still faring well financially. In fact, the market's health is supported by a cumulative 49% home price appreciation for typical American homeowners from pre-COVID July 2019 to July this year. Homebuilders are also offering deeper concessions, with 37% reporting price cuts in August and two-thirds offering incentives such as mortgage rate buydowns or closing cost assistance.

    Buyers are responding to the discounts, with condominium sales increasing in the South, where prices have fallen over the past year. Mortgage applications remain above last year's levels, suggesting more prospective buyers are preparing to enter the market. However, competition remains strong, with 21% of homes selling above the asking price and an average of 2.1 offers per listing.

    Regional breakdowns show varying trends across the country. The Northeast saw a 8.7% increase in sales, while the Midwest experienced a decline. The South and West also showed mixed results, with some areas experiencing price reductions and others maintaining steady growth.