(NEW YORK) — Just a few months ago, the real estate market was favorable to people selling homes. The amount of buyers was increasing, the number of listings were down and interest rates were dropping, it seemed, across the country.
Now, brokers are saying the market has shifted.
“Today, week after week, we see more and more inventory come on the market and demand is down,” broker Justin Itzen, who sells high-end homes in Orange County, California, told ABC News’ “Nightline.”
“Buyers have more to choose from, they can be more selective,” he said.
In expensive coastal markets such as Orange County, there has been a notable drop in homebuyer interest and other signs of a cooling market, according to Taylor Marr, chief economist of real estate listings site Redfin.
At large, the share of home listings that have been on the market for more than 30 days has increased more than 12% from last year, according to a Redfin report released last week.
As interest rates increase due to inflation, from 2-3% last year for certain mortgages to between 5-6% this month, buyers are more hesitant to take out loans.
“We did feel a very aggressive slowdown,” said Itzen, that happened almost overnight. “During open houses it was like, ‘where’s all the buyers?’”
Iesha McTier-Whyte, a broker who sells middle to high-end homes in the Newark, New Jersey area told ABC News’ “Nightline” that she has experienced the same, but doesn’t view it necessarily as a bad thing.
“It’s nice to see [the market] cool down and kind of go back to the basics,” she said. “What we experienced last year was like no other.”
Justin Itzen’s real estate partner, Gio Helou, said “buyers are [now] able to actually go through the natural home buying process,” instead of making extraordinary sacrifices to try to secure a home.
And 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. They found the process extremely stressful.
“Homes were going within days for way over the 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,” said Tim Sherman, “but it was now over the market estimates of what the property was worth.”
The house fell through, but they were finally able to buy a house. Helou had sent it to them and they put an offer immediately, solely based on photos.
Their home in Dallas sold in a day, they said.
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