People keep asking me when the market goes back to normal. I understand the question, and I usually answer it by asking what normal means to them. Most of the time the answer turns out to be the market of one specific year they enjoyed, which is not the same thing as a market that is stable. Normal is not a date. It is a set of conditions, and some of those conditions have already arrived.
The Greater Sacramento resale market has spent more than three years running below its own recent history, held back by thin inventory, few new listings, and mortgage costs that made a move expensive. The Windermere report describes the early part of this year as modest improvement, with new listings and pending sales both climbing while closings lag behind. Both of those things are true at once, and the tension between them is the whole story.
WHAT NORMAL ACTUALLY MEANS
A normal market is not a market where prices only move in one direction. It is one where buyers and sellers meet in the middle without either side needing an unusual amount of luck. Supply is enough that buyers have a real choice. Demand is enough that well prepared homes sell. Neither side holds an obvious advantage, and transactions happen at a pace that does not require heroics. That is the target, and it is not the same as any particular year.
THE METRICS ARE MOVING IN THE RIGHT DIRECTION
New listings are arriving at a stronger pace than they were a year ago, and pending sales have improved through the start of the year. Those two things together are what a market looks like when it thaws. People who put off a move are deciding to move, and the reluctance to give up an old, cheap mortgage is slowly losing to the reasons they wanted to leave in the first place.
THE START OF THE YEAR WAS SOFT, AND HERE IS WHY
Closings have lagged behind the new activity, and that deserves an explanation rather than a sales pitch. The year opened with thin inventory, a stretch of heavy rain that slows showings, and a run of national and international headlines that made people cautious about large commitments. Tariff uncertainty, conflict abroad, and repeated federal budget standoffs all gave buyers a reason to wait for the next headline. A market can have good intentions and bad weather at the same time.
THE COMPARISON I REACH FOR, AND WHERE IT STOPS WORKING
The comparison I reach for is a car pulling back onto the freeway after a long detour. The engine is fine, the driver is ready, and all that is left is finding a gap and merging at the speed of the traffic around you.
That is where it stops working. A car merges into traffic that already has a speed. A housing market sets its own speed, and the speed it settles at is not the one from a previous year. When people say they want normal back, they usually mean a pace they remember. The market does not remember. It only does what the buyers and sellers in front of it are willing to do.
THE TRADE-OFF YOU ARE ACTUALLY MAKING
There is a real cost to waiting for the market to feel safe, and it never shows up on a report. Time spent waiting is time not spent in the home you wanted and not spent on the plans that made you consider moving. There is a cost to moving too early as well, and I will not pretend otherwise. Paying today’s borrowing costs is a genuine sacrifice for anyone who remembers cheaper money. That tension is the honest center of this market.
WHAT I WOULD TELL YOU TO DO
- Define normal for yourself in plain terms. If it means a lower payment, wait on the financing, not on the house.
- If it means choice and time, that is already here in more price ranges than it was a year ago.
- Watch new listings in your target area, not the regional headline. The region is not your neighborhood.
- Get your financing in order before you start looking, so a good home does not pass while you catch up.
- If you are selling, price to the homes that sold around you. In a thawing market, the right number still does the work.
Two pages I send people first. The frequently asked questions page covers the ones that come up most. The sell your home page covers the timeline and the decisions, in order.
Question for you: when you say you are waiting for a normal market, what exactly would have to be true before you moved?
Adapted from WILL THE RESALE HOME MARKET GET ITS GROOVE BACK?, originally published by Windermere Signature Properties at windermerecalocal.com.
WHEN YOU ARE READY
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