Housing experts have been chiming in on the same theme since last summer: The housing market must find a bottom.
The Covid-19 pandemic, coupled with low interest rates and contract cancellations have led to a dramatic increase in the amount of time that homes spend on the market. Homebuilding starts decreased as the number of vacant lots soared.
In order to push back against the existing sellers, they offered cash incentives for closing costs, custom amenities and interest rate buydowns.
The data suggests that these trends are likely to reverse. Zonda's data shows that new home sales have returned to levels seen before the pandemic.
Keith Hughes, Zonda's director of business development, said: "Which was, by the way a fantastic place for home sales." Data from the company showed that new home sales per month in the first three months of 2023 were 1,092, continuing where they left off before the housing boom in 2020.
Hughes added that existing home sales are another sign of the market's recovery. San Antonio Board of Realtors data shows that closings have increased in the last three month after reaching their lowest level since the pandemic.
Danny Charbel is a leading real estate agent from San Antonio. He said that the rates of closings in April and May were similar.
Charbel stated, "I think people are settling down with the prices and rates of interest." "There is nothing to wait for."
He said that many lenders offer terms which include refinancing options in the event that interest rates fall significantly.
Hughes stated that if the market holds, some changes can be expected.
Hughes said that builders would start to reduce incentives. Hughes said that interest rates buydowns will likely continue for some time, but builders have already started clawing back cash towards closing costs and other expenses.
Hughes stated that "even rate buydowns will eventually stop".
Hughes also expects that new home construction will increase. Hughes said that current homeowners may not be willing to sacrifice lower interest rates in exchange for a slightly improved home. This could lead buyers towards new housing products.