Understanding Seasonal Shifts in the Housing Market

As the year winds down, the housing market often follows a seasonal rhythm. After an active spring and summer, fall typically brings a slower pace—fewer listings, more time for consideration, and potential opportunities for buyers and homeowners planning their next financial move.

Yet in recent years, this rhythm has softened as broader economic forces have begun to blur the seasonal lines. Understanding how these shifting dynamics intersect with traditional trends can help you make more confident, informed decisions heading into the new year, whether you’re preparing to buy, sell, or tap into your home’s equity.

What Happens in the Fall and Winter Market

Housing activity still tends to cool after the busy summer months, but the shift has become more nuanced over the past decade as market conditions have evolved. New listings typically decline; homes stay on the market longer, and bidding wars become less common going into fall and winter.

Nationally, homes spent an average of 70 days on the market last December—nine days longer than in 2023 and the slowest December pace in five years. In the Mid-Atlantic, active listings were up 10.5% year-over-year in November 2024, signaling typical seasonal cooling in contracts and showings. Still, the slowdown proved milder than usual: by the end of the year, closed sales in the region were up 14% from the prior year and pending sales rose 2.1% despite historically low new listings.

For buyers, this means fall and winter can offer a competitive edge, with more time to evaluate homes and negotiate terms. For sellers, flexibility is key. Buyers today are rate-conscious and selective, so offering closing cost assistance, repair credits, or rate buydown incentives can help your listing stand out, even in a quieter season.

The Mortgage Rate Outlook

Following the Federal Reserve’s second consecutive rate cut after a long stretch of holding rates steady, many consumers have been watching closely for signs of relief in borrowing costs. However, mortgage rates are influenced more by Treasury yields and the broader bond market than by the Fed alone.

After the latest cut, Treasury yields rose—pushing mortgage rates higher once again—as markets reacted to Chair Jerome Powell’s comments signaling that future cuts aren’t guaranteed. This means that, rather than moving lower, rates are unlikely to improve meaningfully from where they are today.

Looking ahead, rates are likely to remain volatile rather than range-bound. Markets have largely priced in the Fed’s recent cuts, and the rise in Treasury yields reflects expectations that borrowing costs may stay elevated for some time. The government shutdown also creates temporary delays on key economic data releases—like jobs and inflation reports—that influence market expectations. While it traditionally doesn’t have a long-term effect on rates, this data gap may create short-term uncertainty for buyers and sellers but shouldn’t alter the overall outlook once the government reopens.

If you’re planning a purchase or refinance, focus on what you can control—your budget, credit, and preparation—rather than trying to time rate changes. Based on current market trends, another substantial drop is unlikely.

Refinancing and Home Equity Opportunities

With home values still elevated, many homeowners have built significant equity. This can create options for refinancing, borrowing for renovations, or consolidating higher-interest debt. For those looking to do something with accrued equity, there are options available, like home equity loans and HELOCs:

• Home Equity Loans offer fixed rates and predictable monthly payments, making them a good fit for large projects or long-term planning.
• HELOCs (Home Equity Lines of Credit) provide flexibility with variable rates tied to the prime rate. This allows you to borrow as needed but also means payments can fluctuate.

Before tapping into equity, consider your financial goals and repayment strategy. Refinancing may make sense if rates ease, but it’s not a one-size-fits-all solution. Weigh closing costs, your long-term plans, and the duration you intend to stay in your home.

Planning for What’s Next

The seasonal slowdown can be the perfect time to review your finances and prepare for spring’s busier market. For buyers, this offers the chance to strengthen your financial foundation and position yourself to act quickly when the right home becomes available, including:

• Get pre-approved early to strengthen your negotiating position.
• Review your budget and understand your comfortable payment range.
• Work with a lender who can explain rate lock options or programs designed to make homeownership more affordable.

For homeowners, this quieter period is a great opportunity to review your mortgage terms and consider how your home equity fits into your broader financial goals. Start by evaluating your current loan terms and home equity options, and once you’ve done so, you can better determine whether renovations, debt consolidation, or refinance could improve your financial outlook. It will be important to stay in touch with your lender for personalized guidance on any upcoming opportunities. Proactively engaging with your lender ensures your financial strategy aligns with long-term aspirations.

Navigating the Seasons with Confidence

Real estate is cyclical, and each season offers its own opportunities. While today’s seasonal shifts are less dramatic than in the past, they still play a role in shaping buyer and seller behavior. Taking advantage of the quieter months to review finances, evaluate equity, and consider upcoming goals can help set the stage for success when activity increases in the spring.

Whether your next step is buying, refinancing, or tapping into home equity, the right approach begins with understanding your options and working with a trusted lender. A trusted WSFS Mortgage Loan Officer can help you review your goals and create a plan that fits your needs.