High Homebuyer Activity Persists!
While the housing market is no longer in the feverish frenzy that characterized the past couple of years, it does not imply that today’s market has come to a halt. In fact, the buyer traffic remains robust even now.
The ShowingTime Showing Index serves as a metric to gauge the level of home tours conducted by buyers. The graph below utilizes this index to depict the trends in buyer activity over time, providing valuable context to understand the current situation.
Buyer Traffic Returning to Seasonality
The data illustrates the presence of seasonality in the real estate market. When observing the last normal years represented in gray, a consistent pattern emerges, with buyer activity reaching its peak during the first half of each year, particularly during the spring’s peak homebuying season. As the year progressed, buyer activity gradually declined towards the year’s end.
In March of 2020, when the pandemic struck, the established trend (shown in blue in the middle) was disrupted as the real estate market reacted to the ensuing uncertainty. Subsequently, we entered what could be called the “unicorn” years of housing (shown in pink). During this period, mortgage rates reached record lows, and buyer demand soared to unprecedented levels. Despite the exceptional circumstances, similar seasonal trends persisted, albeit at significantly elevated levels.
Fast forward to 2023, we observe a decline in buyer traffic compared to the previous month, and it is also lower than the peaks witnessed during the “unicorn” years. However, this does not indicate a drastic drop in demand; rather, it reflects a gradual return towards a more typical seasonal pattern, signaling a move towards a state of normalcy in the market.
“Showing traffic declined about 10% in May . . . This follows a typical seasonal pattern – disrupted by the pandemic but now beginning to return . . .” – ShowingTime
Traffic Remains Above Pre-Pandemic Levels
What does this mean for you?
Buyers continue to actively tour homes, displaying greater engagement compared to May 2022, when the impact of higher mortgage rates caused some sticker shock. Moreover, their level of activity surpasses that of the last normal years. Hence, it’s essential to recognize that buyer activity remains robust. In fact, it has the potential to be even more robust if not for the constraint imposed by the limited supply of homes available for sale.
