The best week of the year to buy a home in 2024 is coming up

• The week of September 29 through October 5 is the best time to buy a home, Realtor.com said.
• Homebuyers can save $14,000 compared to the summer median home price.
• Realtor.com cited lower competition and higher inventory in the post-summer period.

Temperatures are cooling, but the year's hottest housing deals are still ahead. According to a new report from Realtor.com, the best week of the year to buy a home is just around the corner.

A long-awaited reawakening for the US housing market may be right around the corner.

An interest-rate cut by the Federal Reserve could result in more homes being listed on the market, as more homeowners may feel compelled to sell their property, real-estate experts say.

Recent economic data showing a cooling U.S. job market and falling inflation have provided the Fed with support for cutting its benchmark interest rate. The central bank began ramping up interest rates in 2022 in an effort to combat high inflation.

Prospective homeowners who buy between September 29 and October 5 could save as much as $21,000 compared to the summer's median home price. The current median price in Western Washington for residential homes and condominiums sold in August 2024 was $645,000, an increase of 4.9% when compared to August 2023 ($615,000).

The three counties with the highest median sale prices were San Juan ($905,000), King ($860,000) and Snohomish ($762,500).

This standout period is the result of a combination of factors. In the past, during the week in question, market activity has slowed, competition has eased, and for-sale listings have picked up meaningfully.

The seasonal cooldown partially results from school-time schedules and shifting weather, as home showings lose their summertime appeal. Competition also subsides, with buyers typically returning in early spring.

Realtor.com said that demand historically falls 29.5% below its annual peak and 14% lower than the average week. Homebuyers might expect even less demand this year as trends return to pre-pandemic levels.

Meanwhile, the firm added that inventory often peaks in early fall, just weeks after the October 5 period. In 2024, supply will likely reach its highest level since the COVID era, it noted.

Lower Mortgage Rates and Increases in Inventory May Ease Affordability in Western Washington

Compared to the average week, there are typically 14% more active listings during the best week, and 37% more compared with the year's start, Realtor.com said. But given this summer's unique pullback in demand, these figures may reach even higher this year.

Right here in Western Washington

• There was a 34.1% increase in the total number of properties listed for sale, with 15,453 active listings on the market at the end of August 2024, compared to 11,525 at the end of August 2023.
• The number of homes for sale increased throughout Washington, with 25 out of 26 counties seeing a double-digit year-over-year increase.
• The five counties with highest increases in active inventory for sale were Douglas (+65.1%), Mason (+49.2%), Lewis (+49%), Pacific (+48%) and Pierce (+43%).

2024's best week is distinct for another reason: mortgage rates are falling. The weekly 30-year fixed mortgage rate now stands at 6.35%, having once touched 7% highs.

That means mortgage rates are at their lowest level since March 2023 (6.35% for a 30-year fixed rate mortgage as of August 29^th), and August 2024 reflected year-over-year increases in the number of active listings, new listings and pending sales. At the same time, the number of closed sales year-over-year was virtually unchanged, and median home prices rose in 20 of the 26 counties covered by NWMLS.

That's as the Federal Reserve is expected to cut interest rates in mid-September, helping to ease borrowing costs in the housing market.

Realtor.com anticipates that this will ease affordability concerns for homebuyers, but it could also signify higher competition. In markets where elevated mortgage costs have priced out consumers, easing rates revive competition and defy seasonal norms.

Mortgage Rates Are Falling, but Won't Get Low Enough for Most Americans

•          Only 4% of US adults would realistically consider purchasing a home at a 6% mortgage rate. But if mortgage rates fell to 4% or below, half would consider it.
•          Roughly three in 10 (29%) US adults say there is no mortgage rate that would allow them to realistically consider homebuying or refinancing.
•          Aside from mortgage rates, 45% say lower home prices would play a role in their decision to purchase a home.
•          More than half (53%) have encountered some sort of obstacle outside of the housing market to homebuying in the past years, with 36% identifying inflation as a primary factor.
•          Average mortgage rates have already fallen significantly since peaking above 8% in late 2023, and they're expected to drop close to 6% by the year's closing. While that may seem like a bargain in today's unaffordable housing market, it's not enough to attract buyers from the sidelines. 
•          With the Federal Reserve set to start cutting interest rates this month, there's a chance we'll see mortgage rates back in the mid-5% range later next year. Even so, just 9% would consider purchasing a home or refinancing it at a 5% rate.
•          The CNET survey found that if mortgage rates fell to 4% or below, half of Americans would consider purchasing a home or refinancing. Unfortunately, it's unlikely we'll see mortgage rates drop substantially without a severe economic downturn.

Good news, despite limited optimism

•          In 2023, housing affordability hit its lowest point in nearly 40 years. It will take a while for the housing market to recover, and many Americans aren't waiting with bated breath.  
•          CNET's survey found that 40% of US adults are either somewhat or highly pessimistic about mortgage rates becoming affordable by the end of this year. 
•          Still, there is still reason for optimism in the long term. Now that inflation has cooled significantly, the Fed is prepared to start lowering interest rates at its upcoming Federal Open Market Committee meeting on Sept. 17-18. This marks a turning point for the housing market, which is especially sensitive to rising borrowing rates. However, the Fed's reduction of interest rates is likely to be a slow and gradual process. 

The 30-year mortgage rate fell 11 basis points to 6.11% last Wednesday, after the consumer-price index released that day showed inflation had continued to cool in August. In its August housing forecast, Fannie Mae said it expected the 30-year rate to fall to 5.9% by the end of 2025.

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