A few months ago, the real estate market was favorable for people selling homes. The number of buyers was increasing, the number of listings was down and interest rates were falling, it seems, across the country.
Now, brokers say the market has changed.
“Today, week after week, we’re seeing more and more inventory coming on the market and demand is down,” said broker Justin Itzen, who sells high-end homes in Orange. County, California, told “Nightline ABC News.”
“Buyers have more to choose from, they can be more selective,” he said.
In expensive coastal markets like Orange County, there has been a notable decline in homebuyer interest and other signs of a cooling market, according to Taylor Marr, chief economist at real estate listing site Redfin.
Overall, the share of home listings that have been on the market for more than 30 days has increased by more than 12% since last year, according to a Redfin report released last week.
As interest rates increase due to inflation, from 2-3% last year for some mortgages to between 5-6% this month, buyers are more hesitant to take out loans.
“We felt a very aggressive slowdown,” Itzen said, which happened almost overnight. “During open houses it was like, ‘where are all the buyers?'”
Iesha McTier-Whyte, a broker who sells mid- to high-end homes in the Newark, New Jersey area, told ABC News’ “Nightline” that she’s experienced the same thing, but doesn’t necessarily see it as a bad thing.
“It’s nice to see [the market] cooling down and getting back to basics,” he said. “What we experienced last year was like no other.”
Justin Itzen real estate partner Gio Helou said, “buyers are [now] able to go through the natural home buying process,” instead of making extraordinary sacrifices to try to secure a home.
ABC News’ Alex Presha talks with Orange County real estate brokers Justin Itzen and Gio Halou.
Yet the rising interest rates have put pressure on buyers in certain ways.
One couple, Deni and Tim Sherman, started looking to buy a home in California this spring and reached out to Gio Helou for help. The process was extremely stressful for them.
“Homes were going within days for well over asking price,” said Tim Sherman.
When they found a home they wanted to buy in Huntington Beach, California, they said they considered liquidating investments to buy it.
Not only was it “15% over the asking price,” says Tim Sherman, “but it was now over market estimates of the property’s value.”
The house fell through, but in the end they managed to buy a house. Helou had sent it to them and they immediately made an offer, based on pictures alone.
Their Dallas home sold in a day, they said.