The Blubber

A widening gap is emerging between what home sellers hope to get and what buyers are actually willing to pay. According to Redfin, in March the median asking price was 9% higher than the median sale price — a sign that seller expectations are becoming increasingly out of sync with market realities.

Spencer Bauman, a homeowner in Cache County, Utah, felt the shift firsthand. After buying his nearly 3,900-square-foot house during the frenzied 2020 market, Bauman had to lower his asking price by nearly $66,000. It took 72 days and a lot of frustration before he finally got an offer — and it still came in $75,000 under his original listing.

His experience underscores the importance of protecting your home investment once the purchase is complete. Costly repairs can make a home even tougher to sell, which is why many homeowners consider a home warranty from providers like First American to help manage the expense of appliances or major systems breaking down.

Why are buyers becoming more hesitant?

Today’s market is being shaped by a number of headwinds that are giving buyers reason to pause:

• Mortgage rates remain elevated, with the 30-year fixed averaging around 6.89%.
• Home prices are still high, despite modest signs of cooling.
• Ongoing economic uncertainty is making job security a concern.
• Volatility in the stock market is denting consumer confidence.
• A growing housing inventory means buyers now have more choices.

Together, these forces mark a stark contrast from the urgency and competition of the pandemic-era housing boom.

Home loan applications for purchases fell 4.4% in the last week of April, hitting their lowest level since February — another sign that buyers are pulling back.

For those feeling the pressure of financial obligations, now may be a good time to focus on getting debts under control. If you're carrying more than $20,000 in unsecured debt, programs from groups like National Debt Relief can help stabilize your finances — putting you in a stronger position when you're ready to enter the housing market.