Wondering if home prices are going to take a nosedive? You’re not alone. Some folks are even crossing their fingers for a price drop to snag a more affordable home. But here’s the deal: experts say that’s not likely to happen anytime soon. Let me break it down for you.

Why Aren’t Prices Falling?

It all comes down to supply and demand—pretty basic economics. Right now, there are way more people looking to buy homes than there are homes available. When demand is high and supply is low, prices naturally go up. Simple as that.

According to the latest data, the U.S. is short by several million homes. This shortage is the main reason prices aren’t budging much. As David Childers from Keeping Current Matters (KCM) explains:

“The main driving force on pricing is the limited amount of inventory in most markets across the country. That issue is not going to be solved overnight or in the next twelve months.”

How Did We End Up Here?

Blame it on years of underbuilding. After the 2008 housing crash, builders hit the brakes hard, and it’s taken a long time for new construction to pick up again. Even though builders are now working overtime, they’re still not keeping up with demand, let alone making up for the backlog.

So, until there’s more inventory, prices will likely stay steady or even climb in most areas.

What About Next Year?

Experts predict home prices will keep rising in 2024, but at a much more manageable pace. That’s good news for buyers trying to get in the game without feeling like they’re in a bidding war frenzy.

Of course, real estate is local. What happens nationally might not reflect what’s happening in your neighborhood. If your area has more homes for sale, you might see prices leveling out or even dipping a bit. On the flip side, tight inventory will keep prices climbing in many parts of the country. That’s why having a local real estate pro in your corner is key—they can help you navigate your specific market.

Bottom Line

If you’re waiting for home prices to drop, you’ll need to be patient. The housing market is still feeling the squeeze from low inventory, and that’s not changing overnight.

Want to know what’s happening with prices in your area? Let’s chat. I can help you make sense of the market and create a plan that works for you!