It’s taken awhile, but…

We are officially in a buyer’s market for the first time in a long time! 

In our first story, we present six stats that show why the current market is tilted in favor of buyers.

But trust us, we know the mood out there. If you walked up to your average buyer right now, they’d likely be shocked if you told them it’s a buyer’s market. 

Our loyal readers will know exactly what we’re going to say next. This is precisely why buyers NEED agents. We’ve got our fingers on the latest data, and we can show our clients what’s really going on in the market.

Of course, each region is different, and sellers still have the edge in certain areas, so while reading the info in our first story below, please remember to keep an eye on the data in your local market as well.

Now, on with today’s Blueprint!

– James and David

We’re in a buyer’s market

For the first time this decade, the U.S. housing market has shifted in favor of buyers, according to Redfin’s latest updates. Here’s the data from February to back it up: 

• There are 3.7 months of for-sale supply sitting on the market, the most since February 2019, and up from 3.3 months a year ago

• Pending sales fell 6.3% to the lowest mark since the early days of the pandemic in April 2020.

• The typical home sold had been on the market for nearly two months (56 days), the longest period since February 2020.

• The median U.S. home-sale price rose 3.7% YOY over the last four weeks ending Feb. 16th, the smallest increase since September..

• The typical home sold for 1.8% less than its final asking price in January, the biggest discount in nearly two years.

• Home purchases were canceled at the highest January rate since at least 2017 last month

Our take

Don’t get us wrong. Regionally, certain markets – e.g., those in the Northeast like Rochester and Buffalo – still favor sellers. But, nationally, it’s a buyer’s market. It just doesn’t feel like it for a lot of buyers because home prices are still high and mortgage rates are hovering around 7%. As agents, it’s our job to help buyers recognize their increased negotiating power. The typical home now sells for 2% below asking price, the largest discount in two years. Homes are also taking longer to sell, with the median time to contract reaching 57 days, the longest in five years. A slower market, where homes sell below list price, means buyers in many areas have more room to negotiate on both price and financing.

We’re giving away an Amazon gift card valued at $250 USD and a 1-year membership to our new luxury real estate program, Estate Elite (valued at $1500), to both new and existing subscribers to the Blueprint Newsletter. Here’s how to enter:

1. Subscribe to the Blueprint Newsletter (if you haven't already!)

2. Follow us on Instagram: @estateeliteagents & @readtheblueprint

3. Tag TWO friends on our Instagram post

4. Fill out the survey included in the newsletter (it’s quick and easy!)

Entry closes at 6 PM (PST) on February 28, 2025, and two winners will be announced on Instagram on March 4, 2025. Click here to enter!

New construction projects stall as builder confidence drops

In January, housing starts fell 9.8% month-over-month and declined 0.7% year-over-year, according to the latest report from the U.S. Census Bureau. These are the key takeaways.

• Single-family home starts dropped 8.4% MOM and 1.8% from the previous year.

• Building permits were flat for the month, but down 1.7% YOY.

• From December to January, housing completions increased 7.6% MOM and 9.8% YOY.

• Builder confidence dipped five points in February, falling from 47 to 42, according to the NAHB/Wells Fargo Housing Market Index (HMI)

• Sale expectations of new homes dropped 13% to the lowest level since December 2023

• In February, 26% of builders lowered prices, down from 30% in January and the lowest share since last spring

Our take

At the end of 2024, the home construction outlook was promising. However, builder confidence and activity have declined due to concerns over material costs, labor shortages, and mortgage rates. These challenges are linked to the Trump administration's tariff and immigration policies. According to Pew Research, the construction sector has one of the highest share of unauthorized immigrant workers at 13%. However, there is a silver lining. Existing home inventory remains limited, and the Federal Reserve is expected to ease rates in the second half of the year, albeit less aggressively than previously anticipated. We do realize this is all a slim basis for optimism, as overall, the market’s trajectory remains uncertain.

Total worth of U.S. real estate nears $50 trillion

In 2024, the total value of U.S. homes reached $49.7 trillion, according to a Redfin analysis of over 98 million residential properties as of December 31st. The market grew 5.2% year over year, the slowest annual increase since 2019 and the second-slowest since 2011.

There are eight U.S. metros where the total value of homes tops $1 trillion, according to Redfin:

1. New York, NY – $2.43T

2. Los Angeles, CA – $2.18T

3. Atlanta, GA – $1.29T

4. Boston, MA – $1.28T

5. Anaheim, CA – $1.13T

6. Chicago, IL – $1.07T

7. Phoenix, AZ – $1.05T

8. Washington, DC – $1.05T

Our take

This is an excellent report from Redfin filled with a lot of interesting facts and tidbits that we’ll be examining in future editions. For now, we just want to take in the awesomeness of the housing market in this country. We know there are many challenges to face this year, but we hope this stat motivates you to keep on churning. Even in our current buyer’s market, home prices—and thus values—are expected to keep rising this year. Why? Because there are still plenty of buyers competing for a limited supply of listings compared to pre-pandemic levels. So let’s get out there and get some of this $50 trillion market!

The news that just missed the cut

• How to buy a house with no downpayment

• Climate change costs are expected to cut home values by $1.5 trillion

• Gen Z is buying homes in the Midwest in huge numbers

• Mortgage relief in sight for California homeowners as $125 Million Package Is Proposed

• The real estate portfolio of Bill Belichick

Foundation Plans

Advice from James and David to win the day

We’ve been saying that agents will need to get creative with financing to help buyers in our current market. Today, we’d like to go over some concrete examples of what we mean by creative financing. 

Use seller credit for rate buydowns – Instead of negotiating down the asking price of a home, negotiate to have the seller buy down the buyer’s mortgage rate. The cost to the seller is the same and negligible, but the savings to the buyer are substantial. 

Seller Financing – Just as it sounds, this strategy involves the seller giving a home loan to the buyer of the property, who then pays the seller back with interest. The buyer benefits with a lower interest rate than what a bank would offer, while the seller benefits by being paid back at an interest rate that’s likely higher than what a savings account or CD would yield.

It can be used for properties with or without an existing mortgage. Also, it establishes a new payment schedule based on negotiated terms such as a down payment, purchase price, and interest rate.

Main benefits: 

• Negotiation Flexibility: All terms are open for negotiation, enabling buyers to customize the agreement to suit their financial requirements.

• Simplified Process: Since there are no banks involved, the transaction can proceed more smoothly and inexpensively without lending fees.

• Potential for Improved Terms: Buyers and sellers can negotiate all payment aspects, not just the purchase price, potentially leading to better and more adaptable loan conditions.

Assumable or Transferable Mortgages – An assumable or transferable mortgage allows the buyer to purchase a home by taking over the seller's mortgage loan. This allows the buyer to purchase with a lower interest rate if mortgage rates have gone up since the seller originally purchased the home (which is obviously the case in our current market). Not all home loans, though, are transferable. Typically, FHA, VA, and USDA loans qualify.

Subject-to-Financing: This is a method where the buyer assumes the seller's existing mortgage payments. The seller's original mortgage remains in place, with the buyer taking over the payments without the loan being formally transferred. It results in the property's deed being transferred to the buyer while the existing mortgage remains in the seller's name. Consequently, the buyer owns the property but makes payments on the original mortgage.

Main benefits:

• Lower Entry Cost: This typically demands less initial cash compared to conventional financing methods.

• Favorable Interest Rates: Buyers can profit from assuming an existing mortgage with a lower interest rate than what is presently available in the market. 

• Maturity Advantage: By taking over a mortgage that began even a year before the purchase, buyers can leverage a more advanced amortization schedule, effectively bypassing a substantial amount of interest.

When using these financing methods, you will sometimes have to educate the sellers, and occasionally, the agents involved. However, the extra step is worth it, especially in tough market conditions or when struggling to sell or buy properties through traditional means. Every situation is different, so different strategies will apply. To learn more, start here, here,  and here.

Learn from the Best in Luxury Real Estate!

Elevate your real estate career with Estate Elite! Along with top agents Josh Flagg, Tracy Tutor, and Glennda Baker, get direct coaching from us, James Harris and David Parnes. Gain VIP access to exclusive training courses, live interactive workshops, and a powerful network. Transform your skills in personal branding, marketing, negotiations and much more.

We are offering a FREE 14-day trial where new members of Estate Elite can try out the membership before paying.

Here’s what you’ll gain during your trial:

• Exclusive Access: Join twice-weekly live workshops and Q&A sessions, led by industry-leading top producers.

• Proven Strategies: Build a powerful personal brand that attracts high-net-worth clients.

• Actionable Tools: Learn how to streamline operations, justify your value, and confidently negotiate at the highest levels.

• Industry Insights: Stay ahead of 2025 market trends and evolving conditions.

Gain insider knowledge, industry tools, and direct access to leaders in the field—all in one destination. Don’t just sell luxury—live it, breathe it, and master it with Estate Elite. Try it out. You won’t be disappointed. We really believe that it will elevate your real estate game to the next level.

FREE 14-day trial!

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

“We have two lives, and the second begins when we realize we have only one.” — Confucius

Next week is the last week of February, friends. It’s startling how quickly time flys. Don’t beat yourself up if you’re not on track. Use this weekend to regroup and start afresh. Each day is a new opportunity to get better, bit by bit. Ruthlessly stay focused and go after your goals. We and others will be by your side to help, but you’ve gotta make it happen. See you next Tuesday!

– James and David