Finally, some good news for first-time home buyers: the housing market is starting to cool after years of crowded open houses, skyrocketing prices, and tight competition.
What’s changed? Inventory is starting to come back from very low levels, while home sales are down. Sellers have become more likely to cut prices and some are seeing their listings stay on the market longer. However, buyers should still expect some challenges. Inventory may be rising, but the numbers are still pretty low. And prices haven’t started falling yet—they’re just going up more slowly.
Here are a few ways to navigate this new market:
Take the time to really research the neighborhood.
When houses linger on the market, you have the time to not only decide if a property is right for you, but if the area is a good fit as well. Neighborhood regret is a very real thing. That’s why we’ve developed Trulia Neighborhoods, where you can get the true picture of a neighborhood before you commit. Read up on honest reviews from residents present and past with What Locals Say, scroll through candid photos (including drone footage) and play with 34 map overlays to find out everything from commute length to crime stats.
Look at cities you thought were out of reach.
If you’ve always wanted to move to San Francisco or Seattle, there’s some evidence that prices already reached their heights. Though you might not find a bargain, a slight decrease in the frenzy could make it easier to find the right place for you. Inventory increased in San Francisco during the fourth quarter of 2018 (compared to the fourth quarter of 2017) by 36.5 percent.
Consider older homes.
New housing inventory remains low, with the construction industry still recovering from the Great Recession. If you can adjust your expectations when it comes to updated features, embrace the possibilities of a fixer-upper and find the beauty in vintage details, you’ll have more inventory to choose from.
On a budget? Focus your home search inland.
When it comes to affordability, you’re still better off heading away from the coasts—especially if you’re a first-time homebuyer under 35—according to Trulia’s 2019 markets to watch. Trying a new locale can have plenty of upsides. For instance, #1-ranked Colorado Springs has 3 percent year-over-year job growth. And it’s not like you’ll be sacrificing quality of life. If you live in the Central Colorado Springs neighborhood, for example, you’ll be living near a food paradise on the restaurant-heavy Tejon Street (including Urban Egg, a brunch haven with a legendary build-your-own-Bloody Mary bar).
Be prepared to negotiate—but not about price.
Despite increases in inventory, prices have remained the same. While some sellers might not be amenable to price changes, the shift to a buyer’s market can give you an upper hand for other asks. You could negotiate for the sellers to make repairs or improvements to the property, for example. It may not change the sticker price, but it’ll still be money in your pocket when you don’t have to pay for them yourself.
Ready to start your Spring 2019 home search? See what’s available in your favorite neighborhood, here on Trulia.