Saturday, June 18, 2022 / by Bryan Baylon
High prices and interest rates are keeping a lot of potential home buyers out of action at the moment. In addition, deals in escrow are starting to fall through in larger numbers. Both these trends are causing the count of listings under contract to head downwards. Here is the weekly chart for listings under contract for all areas & types in the ARMLS database.
You can see that in June we are below the level of the third week of January. This is previously unheard of and indicates very poor demand for the time of year. In fact we have to go all the way back to 2008 to find a mid-June reading as low as this.
Some buyers are backing out of contracts they have already made. Others are offering much lower prices than originally agreed, sometimes just as escrow is due to be closed. In England we have a word for this - "gazundering". Google it, if you don't believe me. It has very negative ethical connotations, but it is legal.
These are all signs that our long-term seller's market may be coming to a rapid conclusion. Some iBuyers and institutions, who came to the market's rescue in 2021, are joining the stampede we wrote about yesterday. The larger the herd, the more dangerous the stampede.
Market incites provided by the Cromford report.