The housing market took a slight dip in contract signings in July, but that could potentially mark an opening for home buyers who have been shut out by fierce competition over recent months.
The National Association of REALTORS® reported this week that pending home sales dropped by 1.8% in July compared to June, the second consecutive month for declines. Only the West saw contract signings increase last month. But all major regions across the country posted year-over-year declines. Contract signings dropped 8.5% nationwide annually.
“The market may be starting to cool slightly, but at the moment there is not enough supply to match the demand from would-be buyers,” said Lawrence Yun, NAR’s chief economist. “That said, inventory is slowly increasing, and home shoppers should begin to see more options in the coming months.”
Homes listed for sale are still generating lots of interest from potential home buyers. “But the multiple, frenzied offers—sometimes double-digit bids on one property—have dissipated in most regions,” Yun said.
However, “even in a somewhat calmer market, a number of potential buyers are still choosing to waive appraisals and inspections,” Yun added. More than a quarter—27%—of buyers waived an appraisal and inspection in making an offer on a home recently. Buyers are looking to accelerate the home purchase process by doing so, Yun said.