More and more would-be homebuyers are hitting the pause button, with those who do pull the trigger more likely to be buying out of necessity than of desire.
Multiple listing service Bright MLS calls it a “noticeable shift” towards a more balanced market, and says agents in its large Mid-Atlantic footprint are working with more and more clients who have put their home search on the back burner.
Affordability is still a challenge. But fewer buyers were sidelined by high home prices and high mortgage rates as the main reason they stopped looking.
In its recent survey of 1,000 agents — half representing buyers and the other half working for sellers — Bright MLS found “a growing share” of buyers are dropping out because of other financial issues or general uncertainty about the market.
Specifically, 18% of the agents mentioned financial issues as the main reason for walking away from the hunt. That’s twice as many as in the second quarter of 2024. And 33% noted economic uncertainty as their reason for stopping vs. 26% a year ago.
In Bright MLS’s most recent July survey, nearly three-quarters of respondents said they had worked with a buyer who had decided to pause their home search, up from less than two-thirds at the same time a year ago.
Now, necessity is the name of the game, with family and job reasons the most likely sales drivers, the multiple listing service advises.
According to the survey, the share who bought for family reasons increased from 15% in last year’s second quarter to 20.5% in the same period this year. The share buying for job reasons increased slightly from 11% to 12% over the same period.
At the same time, nearly one in three buyers last year moved ahead because they were tired of renting or wanted to join the ownership ranks. But that share fell to one in four this year. In June alone, about two out of five were first-time buyers — the lowest share since the MLS started keeping score in 2023.
Sellers, too, are pulling back, according to Bright MLS — which covers a six-state region that includes Pennsylvania, West Virginia, Maryland, Delaware, Virginia, New Jersey, and the District of Columbia — and for much the same reasons.
Indeed, a growing share of sellers are even de-listing because they are unable to get the prices they are looking for.
A year ago, nearly half the agents polled said they had worked with a homeowner who decided not to sell because they could not find another home to buy. But this year, that share dropped to just 22%.
In 2024, agents said 35% of their clients who decided not to sell did so because they didn’t want to give up their low mortgage rates. But this year, only 16% of sellers were influenced by mortgage rates.
Looking ahead, the agents surveyed expect seller activity to outpace buyer activity for the first time in two years. And as a result, house prices will continue to soften or even decline in some local markets.
The agents also believe buyers who remain in the market will have more negotiating power, while sellers who need to sell are going to have to price their properties appropriately to attract attention.
