Market Momentum: 2026 Housing Outlook

The market finally feels like a market again—more choices, smarter buyers, and real negotiations that reward accuracy over adrenaline. We sat down with real estate analyst and regional vice president for Howard Hanna Allen Tate, Tony Jarrett to unpack where 2025 left us and how to play offense in 2026 without chasing headlines or hoping for miracles.

Inventory is climbing across the Carolinas, but it’s not a free-for-all. We break down the split reality most people miss: a fast lane for well-prepped, well-priced homes that go under contract in roughly two months, and a slow lane for wishful listings that sit for four months with mounting reductions. You’ll hear why delistings have surged, why fall-throughs are up to 10–12 percent in some pockets, and how property condition has overtaken appraisals as the number one deal killer. If you want to sell quickly and for more, the playbook is simple: price to the active set, stage and fix what matters, and consider targeted concessions like rate buydowns.

We also tackle appreciation, affordability, and rates with context that actually helps. Expect steady two to four percent price growth, healthier months of supply, and mortgage rates flirting with the fives—enough to pull millions off the sidelines. Builders are winning with incentives; resale sellers who package similar offers are meeting intentional buyers where they are. For first-time buyers, layered financing and credible condition beat shiny headlines. For boomers holding big equity, we lay out honest strategies to bridge the renovation gap and trade up, down, or closer to work as remote policies shift.

If you’re an agent, your edge is education and consistency: weekly reviews of the active competition, micro-market updates to your database, and clear scripts that anchor decisions in today’s numbers. If you’re a buyer or seller, the path is straightforward—make moves when life needs it, not when the news cycle shouts. We’re here with the data, the context, and a plan you can use on your next appointment or your next offer.

Enjoyed this conversation? Follow the show, share it with a colleague or friend, and leave a quick review so more people can turn data into smart decisions.

Transcript

Setting The Stage And Markets Served

Gary 0:01

I am your host, Gary Scott. And today we have first my good friend, but also real estate expert from the triad in the high country, Mr. Tony Jarrett. Tony, how are you?

Tony 0:15

Good. It's good to see you. Having fun in this winter weather up here.

Speaker 1 0:19

It's always good to see you. Hopefully, by the time people listen, they will have thawed out. Just as a frame of reference, uh, we are between snowstorm one and what I read is snowstorm two. And so uh first, I hope everybody is staying safe out there. Uh, this is the most widely listened to reality podcast. And what we decided this past year in 2025, Tony, as you recall, is every quarter you and I would just talk about the previous quarter and a little insight into what we think next quarter. So I have to tell one story and then we're gonna get rolling into things that are important: inventory, interest rates, days on the market, mud supply of inventory, baby boomers, mortgages, all of those things. Uh, after our last uh uh recording, Tony said to me, Gary, don't you want to have other guests uh you know report back on the quarterly? And I said, No chance. I said, we are on a run of the most widely listened to reality podcast. And if nothing else, our audience knows that you and I enjoy each other's company, we're passionate about our business. Uh I know we're optimistic about 26, but uh let's kind of dig in. You know, you are a guy that spends a lot of time really looking at the empirical data and uh share that with our audience. So uh first of all, this what trends uh did you see at the end of 25 that may or may not move into 26?

Speaker 1:52

So there's so much to talk about. I will tell you looking at all the regions that we serve, one of the trends that came strong through 2025 was listings, more for sale signs. So the fourth quarter, it slowed down just a little bit, but it was still over year over year, probably 15 to 25 percent year-over-year gains in for sale signs. Uh, I get a lot of questions of tell me what's consistent everywhere. And that is one of the things that was very consistent. I do believe that's going to carry into the spring market this year. And I would bet we're gonna have more properties come on the market.

Inventory Rises And Delisting Surge

Speaker 1 2:34

So let me piggyback and ask a follow-up. One of the things Tony said is what is consistent across our footprint? Now, for our listeners, uh, we have them from really all over, but uh, you know, we got North Carolina, South Carolina, Georgia, uh, and then we've got Virginia. And so our data that we're gonna share is gonna be specific to the markets we're in in North and South Carolina, but I want to make sure everybody understands that a lot of that will lay over into another market. Um but as Tony said, uh, in order to be consistent across multiple markets, we always have to remind ourselves the market is hyper, hyper local. And I share that as we continue to have conversation, Tony, because of the incredible importance of staying crystal clear away from uh the national media. Right. And we'll we'll come back and talk about how the national media, as a matter of fact, you and I have had some fun in the past on uh uh factor fiction, perception, reality. Tony, there's a concept that has been written about uh called delisting. And uh you put it in your notes. I think you called it uh uh you called it, I think you called it a failure rate. So let's just talk a little bit about what a delisting is and what does that indicate, uh, what opportunities that it might present for a seller now. So uh walk us through that if you don't mind.

Speaker 4:04

Yeah, so I've always done consistently the five stats. This year I've added the sixth stat, which is failure rate. Uh it's a new one. Uh, we haven't seen it in many years, but and there's some different levels. So one level is delisting. So, what is delisting? It means the seller just decided to take the house off the market. I didn't get the price I wanted, I didn't get an offer, I didn't get many showings, whatever the case may be, I just decided to quit. And so what we're seeing is that typically is an expired listing, a withdrawn listing. Uh, in the United States, our good friend Dave Childress says that's a 55% rate in 2025. Now, think about that for a second. Across the country, 55% of all homeowners just decided to pull their house off the market. Now, I will tell you it's not that high in the Carolinas, but it is high. And what I will tell you is what I'm tracking in, and I looked at the to two examples is the tried region and the triangle region. So the Greensboro High Point, Winston, and then the Durham, Chapel Hill, Raleigh market. That was between 30 to 40 percent of every listing in 2025 came off the market because of that reason. So you could safely say one-third of all sellers just quit for whatever reason. That doesn't mean they won't come back next year, and maybe they will until this year, I mean in 2026. But the reasons are why. Um, I will tell you that there are layers of that. We're pushing in those two regions, almost 40% had a price reduction. So probably the number one reason is I didn't get the price I thought I was going to get. And I will tell you that it's the hardest job we have today is getting properties price right to hit the market because we do have such price appreciation over the last four or five years from the COVID. And that's another stat we'll talk about that's calmed down. But we do have some sellers that maybe just maybe are shooting for an unrealistic number. And maybe we can't get that number because their neighbor got it back in 21, 22, or 23. And now the market is speaking differently, and it's created a failure rate of inventory that was sitting there, and now it's come off the market.

Failure Rates: Why Deals Fall Apart

Speaker 1 6:23

I'm gonna piggyback off a stat you gave when it was specific to the two markets you indicated, which was 40% of the active listings had had a price change. And what I want to do is provide a little perspective because when we looked at that data just six short months ago, it was 32%. Yeah. And so it's moved into the 40s. And as Tony said, you know, 55% had come off the market. Now, we'll also talk about, as Tony said, there are still more homes on the market for sale today than were a year ago, two years ago, three years ago. I think with that data, which is one of your five stats, we also have to talk about month supply of inventory. And I know you've done a great job, Tony, of breaking that down by region. Again, a reminder to everyone listening about the uh the importance of understanding that every market we're in is hyperlocal. And we've got to educate ourselves on the market that we are talking about when we're with a buyer or seller. And we've got to stay very clear from generalizations. You know, the more specific we can be, the more empirical data we can draw, the more specific examples we can give, is gonna make, to your point, it's certainly gonna make the pricing conversation one that is less emotional and more intellectual, which is really what we have to do better in 26 than we've ever done, is provide empirical data and not, hey, it's my opinion, Tony Jarrett uh seller. Here's the data, right? So uh let's jump a little bit.

Speaker 8:04

Uh let's go go ahead. Before you do, I want to give uh the audience another failure rate.

Speaker 2 8:09

Yeah.

Days On Market Split And Pricing

Speaker 8:09

And that's on the buy side. So typically we have what I would call a healthy failure rate. There's going to be a number of deals that just don't go through because of whatever reason. Typically, we see that around 8%, meaning that closings, you get under contract, 92% of the deals should always close successfully. But why does 8% not close? Typically, it's an appraisal, a mortgage issue. Uh, and then there's property condition and inspections that that repair request. And then there's that last one, which is just buyer's remorse, where they just a buyer may just change their mind. And and it's rare, but sometimes we've seen sellers change their mind. Yeah, right. So with that being 92%, I will tell you it's starting to track up higher this year, especially in the second half of 2025. We saw in the Carolinas it inching up to 10%, and some just some like your hyperlocal down to about 12%. And the question is why? Well, let me tell you what it's not. It's not appraisals. We're not seeing appraisal issues. We're also not seeing a lot of mortgage issues, meaning credit scores, and that that's kind of cleaned itself up. But there are two that I'm really seeing, and one is the property condition. We're seeing a lot of sellers put their house on the market and they haven't touched it in years. And uh the the idea is that you you stage the house, you get it looking good, but when the inspector comes out, we start digging and we find some things that have been neglected. Well, that is starting to turn more to probably the number one reason, and that's just as you own your home, it's always good to do a little bit of home maintenance every year versus waiting on this. And now hopefully the buyer will take it. Well, a lot of buyers today, especially the younger generation, are looking for more turnkey. They want the house in good condition. And it's leading to more buyer remorse because they're just changing their mind. And as the the market has become more healthy and we're negotiating more, guess what's dropping? Earnest money and due diligence amounts. Now, I want you to think, guys, when you sold the house in 21, we all complained about how due diligence in North Carolina that was going between five to ten percent of purchase price. When I came in the business, probably you, Gary, we both were trained around 1% of the purchase price was a safe number. Well, we're seeing that number drop again. We could complain about 10%, but guess what you a $300,000 house and I give you $30,000, guess what? I'm not doing I'm not walking away. But when you give less than 1%, which would be $3,000, we're seeing buyers go, you know what? I'm out of here. And that between the property condition and the low amounts, it's creating a more a higher rate of failure rate, if you will. So we really are doing a lot of coaching with our sellers around this property condition and negotiation because it's it's definitely changed in that trend. Probably the fourth quarter, we saw a lot more of it.

Speaker 1 11:14

Great, great stats. A couple things. So uh when Tony talks about that failure rate, you know, it's also known as the fall through rate under contract. And so the other one that does happen is from time to time, particularly the buyer, but sometimes the seller, in that short window, their circumstance changes. Now that's a small percentage. So I'm gonna give a perspective. As I look back over my career, uh, the highest number I can remember over the course of a year, Tony, is 14%. So Tony said eight to 10 to 12. So I saw 14. I'm not gonna, I'm gonna take a shot in the dark that it might have been somewhere between 07 and 12, right? Uh, as the world really changed. I think the other thing Tony brings up, and again, this is really a reminder to every one of our agents who is spending time connecting with their sphere, who are homeowners. I have said for decades, Tony, how important it is every year for every homeowner to identify, and I always say like one to two percent of the of the value. Yeah, to invest in your house to make sure that it remains pot, it remains a great house while you live there. We you and I have seen time after time where people don't keep up the house, right? When they go to sell it, they do all the work, and then they're like, heck, I don't want I want to buy this house. I've made it so nice. Yeah, you brought up another really great point. And I I use I use the phrase today's buyer doesn't either have the time or the imagination to go from A to B. And they turn they want to walk in and I'm gonna pay this amount, I'm gonna put a little bit over here because you always got to do something, right? And so I think that's uh really an important thing for us to think about. My encouragement to our listeners, I would go to my sphere the first quarter of this year, uh, whether it's my uh you know, my equity assessment or my home physical or my pop pie, what are you gonna do to your house this year? So, an example if I've got a home worth $600,000, every year I got to spend six to nine. I gotta make sure that uh that X is is in good shape, and I might have to do Y, and I might have to repair some windows, and I might have to make sure my roof is like, don't wait. And you're better off spreading it out, particularly because of the equity that has been built. I will have to share this, and I know you're gonna get back to price in a minute. So uh I actually want to wait till you do that, but I'm afraid I'll forget my stat. But I'm gonna take a chance, but I'm gonna take a chance. Last thing for me is I go back, Tony said when he and I were in the business. 1%, it was in due diligence, it was uh earnest money. Right, right. 1% and another three to four after the mortgage commitment and after the inspection contingencies were satisfied, right? Right. And so to your point, uh there was only one percent at risk. And so again, the evolution of due diligence, the evolution of post-COVID, really important to understand. You know, what's interesting, Tony, as we come upon March 15th, 17th of 2026, it doesn't seem like six years ago.

Speaker 14:48

Yeah, right.

List-To-Sale Ratios And Strategy

Speaker 1 14:49

No, it doesn't. It feels like another lifetime ago. Think about that. The other date that I think is fascinating for us to think about is you know, mortgage interest rates, June of 22, which would be three almost four years ago, went over eight percent as a result of inflation at an all-time high of 9.1%. We're gonna talk about interest rates, we're gonna talk about normalization, we're gonna talk about what we think it's gonna do to impact our business. But uh, Tony, so uh let's let's talk a little bit about uh days on the market. Another really uh one of your most significant five stats.

Speaker 15:32

So days on the market, the words I'm gonna use are slowly increasing. So they've been slowly increasing all of 2025, but there has been a shift I've seen in the second half of 2025. And I'm gonna give the audience two days on the market. There's a days on the market that went under contract, a success numbers, I always call it. Meaning that you got to you you listed the property, how many days did it take you to get a contract? That's one market. What's happened in the regions is that we're seeing a second market, which is active listings for sales signs that have not received an offer. And they there are two different markets. So let me give you a couple of examples. And this is consistent in many of the markets we serve. But for example, in the triad region, in the fourth quarter, it was 47 days ending the year with a contract. But there were a number of active houses that have not received it. They're on the market for 72 days. Now walk with me. In the triangle, that numbers 57 days success. So that's just a little less than 60 days, two months, but the active houses were on the market for 114 days. You see that gap starting to widen, meaning that now you're going to four months. And so there's that market sitting there waiting on showings, waiting on offers, and the other ones are getting offers and they're closing. Then I take you up to the mountains up in Asheville, 59 days sold, but the active 126. I can do that in every single region. And I will tell you, I've not seen this since like 2018, 2019. So we're seeing two markets. And it's the market where the sellers are really serious about selling, hitting the market right, not reducing multiple prices. And then there's the other one sitting there fishing. Let's just see if we can get it. Oh, we'll come down later. Let's see. But two months to four months is quite a difference in success rate when it comes to a day's on the market. So that's the biggest trend I've been seeing with that stat.

Equity, Appreciation, And Perspective

Speaker 1 17:40

I'll I'll share with you a stat I pulled up again. Uh, you got to be careful of your source, but I think that it speaks to this conversation about pricing, right? What Tony just shared is we got like two railroad tracks. Yeah, we got what happens to price rate and what happens to not. And I always say, you know, the median day on the market is much more significant than the average day on the market, right? That's correct. And so uh just bear with me, uh, audience today. So this I picked this up, and you know, I'm not sure it's 100% accurate, but it is directionally correct. The longer the house sits, the less it will sell for. Okay, that kind of makes sense. Zero to two weeks, if you get it sold in zero to two, you're getting 100% problem. Three to four, ninety-nine, five to eight, ninety-eight, nine to sixteen, ninety-six, seventeen weeks ninety-four. So think about the data Tony just gave you, compare or reconcile that to what I just gave you, and it supports that, right? Think about this. Over 40% of every active listing in most markets today have had a price change. Like, think about that. 21% give or take, depending on your market, sold for over-asking price. Those data points must be reconciled. What Tony just said is I think I I'll get it wrong, Tony. I didn't make a note. 57 on the ones that sold, 114 that are on that are active listings that didn't sell. And so the other data point that is significant is the national media is putting out uh a data point that says 53% of people's home is worth less today than it was yesterday. Well, okay. I also read that the average appreciation from 16 to 25 was 72 percent. It's all about perspective and relativity, right? If I bought then and I'm selling now, I have to reconcile that. If I bought 216, I have to reconcile that. And, you know, uh the other stat that's amazing is you know, 40% of homeowners have no more. The equity out in the world is significant. We'll talk a little bit about a stat Dave Childers gives us, which is uh Home uh real estate values and mortgages to just show that incredible equity. Equity equals opportunity, Tony. I mean equity equals opportunity.

Speaker 20:09

So um You know, to this, it's really a simple question for our clients, especially the sellers. Which market do you want to be in? Because echoing what you just said, would you like to sell it quicker for more money? Or would you like to reduce your price, take less, and take longer to sell? And those are the two choices. It's really that simple right now in this market.

Speaker 1 20:30

So let's uh let's talk about days on the market as it uh shifts itself from you know kind of throughout the Carolinas, because I also want to I want to really speak to that data point. So let's just talk about what trends you've seen, days on the market, uh, and then uh not only days on the market, uh, but uh percent list to sale points. So list to sell. Yeah, I'm sorry, you just touched on days on the market. Let's talk about list to sale points.

Speaker 20:55

Yeah, it's it's also moving slowly. So we talked about days on market moving slowly, list price to close price ratio, again, two markets, with no price changes across the Carolinas. I'm tracking around 98 to 99 percent. That is, if you hit the market right, it's starting to get to 98. But you remember go back to three years ago, it was over 100 everywhere. I don't think any of us had seen that in our careers. Now it's starting to get healthy again. You know, 98% of your what you're what you're asking is quite healthy, if you ask me. Now, when you do a price reduction, that's starting to widen. And we're starting to see more of 95-ish. So I want you to think about this for a second. If you take a $300,000 house and you get 98%, you're gonna negotiate somewhere around $6,000. But boy, you start getting to $95,000, you're talking about $15,000 that you're gonna take a hit on. And that is starting to widen again. It's very similar to the days on market, but we're seeing the market start to show more negotiations happening. And the more risk that you do by going high on your price, you're opening up yourself to more negotiations uh in that in those two numbers. But anywhere from 95 to 98 percent is what I'm seeing from one price, uh no price to one price reduction is is the number.

First-Time Buyers, Builders, Concessions

Speaker 1 22:20

Yeah, so I I think that's really an important stat. I think the day uh the percent list of sale has always been an intriguing number to me. Yeah. Because uh the data draws on the last list price. And if we believe that 46% of every active listing has had a price change, you know, I've always when I was selling actively, I wanted to know the percent of sale price to original list price. Because that's when I was trying to create my own value proposition, you know, I would always say something like, you know, 80% of every listing I have sells before a price change. Like one of the things that I'd like this audience today to take away is uh do what we call a transaction audit of your own business from last year. Go look at every single transaction, take a look at what you did right, what you might have done differently, but but create your own set of data points and compare that to the market because if I'm out in the marketplace, by the way, uh I've been setting up on some statistics because I think they are in uh they're impactful. 81% of every seller only interviews one agent. So that is a message to everybody. My question is, how do I become that one agent? Like that's the like we have to assume we're in competition. Yeah, but the reality is if if that number's accurate and whether it's it's 81 or 71, that's kind of irrelevant. But what we know, we have to do something in our business to be that one, if that data is remotely correct. And so I want to challenge everybody to know your information. You know, if the market says it's 97% list to sale and I'm 99, that's a value proposition. If I average 0.7 price changes in my 14 listings, like I want to I've said this all, I've said this for years, Tom. What is the one thing that a seller wants? There's only one thing they want. It's a result, an acceptable result. Right. Like, like yes, they want communication, yes, they want follow-up, follow-through, yes, they want uh open houses, yes, they want marketing and exposure and social media. They want you to sell their house.

Speaker 24:46

That's right.

Speaker 1 24:48

So as our audience thinks about solidifying their plan for 26, who are you? How do you perform against the market? I also say, how does your branch perform against the market? Now I bring my team with me.

Speaker 25:04

Yeah, I love that because you talked about hyperlocal. Your own stats are hyperlocal. So, especially in certain neighborhoods, price points. But you know, as we're looking at our hyperlocal stats, you also we have so many agents who focus on closed comps. And I will tell you what's really resonating more is the active market. So we need to double check ourselves when we're running these stats to see it's kind of like I was talking about there's two markets. There's the ones that have already closed, but there's the active market that's telling a different picture right now. And I will tell you as as agents, you really should be looking at that every week. Pick one day of the week when you're looking at your inventory andor your buyer clientele and start watching because I have seen some things change. Every 30 days, there's maybe a new trend in that hyperlocal. You really need to be staying in tune to what's happening in that market with some of these dads.

Remote Work Reversals And Intentionality

Speaker 1 25:58

One of the things I did, I I don't I don't ever listen to reality podcasts. You know, my kids joke, like, are you driving down the street, dad, listening to yourself? I said, like, I don't do that. I don't do that, but I did listen to our last quarter, and we talked about this to him. Yeah. And what we said was your competition is are the six listings in your price point in your general vicinity. And and and what we said then, and I'm gonna say it today, because number one, as Stephanie Riley reminds us, the rule of 11, us adults need to hear things more than once, is is that you know, my my my job as a as a real estate professional would be to come out and bliss Tony's house. Tony, as part of our journey, I'm gonna go show you, get my car, and I want to go look at every one of our competitive listings. Then I assure you, as part of my plan, I'm gonna microanalyze the traffic to those listings, the sales of those listings, and if one of them sells, and I find out the selling agent didn't show yours, I'm gonna call. Now I can't promise a return phone call, but I'm gonna I'm gonna do my best to understand the why. Right. So I I I'm gonna double down on our conversation we had a quarter ago and say to our professionals more important than what closed last month, the month before, six months before, what are you competing with today? And then monitor that at a micro level to make to help you determine today's market value based on today's buyer, today's interest rate, you know, today's weather, right? Um by the way, uh, a little tidbit for us real estate professionals. Uh, as many of you know, my dad was in the business, and every time there was a snowstorm, you know, we said, I thank God I wasn't in the restaurant business because restaurants lose business. Ours is simply delayed to a sunnier day. So uh if January is a little not where we wanted it, it's a matter of they're gonna buy the house that we're gonna buy today, Tony. They're gonna buy it February 14th. Uh Valentine's Day. But uh, let's talk about prices, Tony. Let's we talked about it a little bit, roundabout way. I I shared a number, you shared some numbers. What do you what are you seeing uh that happen in the fourth quarter? Probably as important to anybody. What do you, we think 26 is gonna have in store for us from an appreciating uh home advice?

Supply Balance And Local Variations

Speaker 28:33

Price appreciation is continues to uh my words will be normalized and get real healthy. Everywhere I tracked, it was somewhere between two to four percent average annual appreciation, averaging out every quarter. Um, there are two messages that I concern I get concerned about the media. I already said that 40% in some markets are seeing price reductions. That does not mean that you're losing appreciation. Uh, those are two different animals altogether. Hitting the market right, and you talked about it earlier, hitting the market right, you should still appreciate. But we're not seeing that 10, 14, 18 percent noise that we had in 21, 22, but we are definitely seeing it level out, and it's really consistent in most of our regions. So a seller who, and then I saw something this morning that made me think about this this lock-in effect that we've had of the 3% mortgages. Uh, I saw for the first time this morning that it's actually reversed, it's gone the other way. That buyers who are sitting on these houses because of this mortgage rate, 6% is starting to normalize that that behavior. And so a lot of people are starting to trade that 3% for 6% because of life. I need to go buy, I need to family's growing, I'm relocating. You tie that to appreciation. Uh, if you and you said it earlier, if you sold, if you bought a home three or four years ago, you're not going to lose money, but you may not gain 10 to 15%, but you should gain something. And that 2% to 4% is probably a very healthy number to think about over a number of years. And most of us, the tenure I saw for the national is 11 years. 11 years is still the number that I'm in my house. And to your point, if I've been in the house 10 or 11 years, I'm going to have a nice equity in the house by probably about now and have a healthy average appreciation. But I I don't see these numbers changing. I do think we'll continue to stay healthy in this 2026 with that appreciation.

Speaker 1 30:36

I think the other big number, and I know we talked about this last time, but I I continue to remind when I get out to sales meetings, business meetings, Tony, is you know, if if we look at what I bought a house for when I sold a house, in my view, the real assessment evaluation of my investment is what I call my cash-on cash return. Yeah. If I bought a $300,000 house and I put 20% down, I put down sixty thousand dollars. So if I walk away with ninety thousand, like I think about my financial advisor, as you know, happens to be my son, I I would take that return every day from him. Right. And so too often we're worried about what happens, like Tony said, not only are we getting appreciating home values, but we're building equity as we make payments, right? Uh if you remember the data from 19 to 24 was appreciation averaged 57, but equity buildup was 74%. And so I I I continue to absolutely believe, and I want to talk about this a little bit later, Tony, that you know, it is still a great time to buy a piece of real estate. It is a great time to sell a piece of real estate. Yes, the month supply of inventory is not aligning with what has historically been, I call it the break-even, right? The six months. You and I have talked the last three quarters, you know, maybe six months has moved to four months just because the world uh has changed. So um interesting. Uh Tony, let's uh let's talk a little bit about first-time home buyers. Um you know, the data says I think uh, you know, 21% of every sale last year was a first-time homebuyer. The average age of a first-time home buyer was the oldest it's been, which is 40. The average age of a home buyer seller 61. Uh, let's just talk about the uh that that evolution, uh, if that's the right word.

Interest Rates Drifting Into The Fives

Education, Affordability, And Taxes

Speaker 32:41

Well, I do believe that there was a generation of buyers that have been sitting on the sidelines waiting on rates to drop. And I think this year we're gonna see that move. 20, see, this is 2026, we're entering at 6%. 2025, we entered the market at 7%. 2024, we entered the market at 8%. You see the trend. So I think in 2026, uh it's gonna be a couple things. It's gonna be mortgage rate that's going to move me. Two, it's gonna be more options, more inventory to move me. And three, um, I don't have the graph to show you, but one of the graphs that's finally we're seeing in the last 24 months is wage growth is exceeding price appreciation. And so when I feel more confident about my salary and prices and real estate are leveling off, and I can uh buy cheaper on the rate, I think you're gonna see more first-time homebuyers move into the market in 2026. I also believe that um we're gonna see some local governments. There's a lot of advocating going on right now for some first-time homebuyer monies trends. Um I said it in our last one, and I'll say it again. Buyers right now are shopping mortgage rates and mortgage payments, loan payments, more than they are the price. If the house falls to three to $350, whatever. But I can only pay $2,100 a month, whatever that number is. Where we're seeing market trends succeed is new home builders are really succeeding right now. We talked about it earlier, the condition issues have been a problem. So buyers moving in don't have condition issues on a new construction, and the builder is offering on a $400,000 price, the average is about a $10,000 connection uh concession between blinds, appliances, and more than anything, the mortgage buying down the rate. What we're trying to get our sellers on the resale side to think about not only condition, but are you packaging a concession? We will get you that price, that 98 to 99%, but you're probably going to have to help the buyer buy the rate down, maybe from $599 down to $499 or two, one block down. There's so many ways to do it. Uh, or closing costs, help me on the down payment on the closing costs. I do think that's going to start appealing to the millennials who are coming into the market. Help me get into that house financially, and I'll make you a really good offer and a clean offer. That's we didn't see this three, four years ago. Uh, and I'll say this this is a really important thing that one of the agents told me the other day with what she's seeing with clients, and it resonated with me, is that in 21-22, when you were up against four to seven offers at a time, there was a lot of emotion. Today, I'm not competing with that many offers. It may be one offer. So buyers are more intentional today and less emotional. Think about that for a second, because five years ago they were more emotional than intentional. And now, layer what's getting ready to happen in the market. We're seeing more businesses saying, no more COVID restrictions as far as working remotely. We want you back in the office. Well, I bought that house 20 miles away from the office to get out away from everybody. It didn't really fit my need. I bought it emotionally because I had to beat five other people. Well, now I need to get back closer to the office so my commute's not as long. And I don't really like the house I'm in. I actually like the house that's closer to the office because it's smaller, it's got another bedroom, whatever the case may be. You're gonna see that trend happen in the next couple of years. Now, I just unpacked a lot right there in those.

Boomers, Renovation Gaps, And Reality

Speaker 1 36:32

So, this is what I'm gonna have Lori transcribe and send our notes back to us. Uh, I'm gonna piggyback off a comment you made. And uh, for the first time in in a long time, there are more mortgages over six than under three. Yeah. So, like that really speaks to Tony's point. Just I want you to kind of wrap your head around that. Uh, the other thing that I think is is super interesting, and I I just wrote this down, you know, since 1950, Tony, home prices have only declined seven years. So this concern and that with 9091, 789, 10, 11. So 7, 8, 9, 10, and 11, and we're not going to go through it today, but the uh the dynamic of this market and the dynamic of that market are not near, they're not even close. Uh we can go from, you know, by the way, uh here's a little note to collective selves listening. Be careful when you read for closures up 21%. Like I'm just going on the record. When you are zero, or you know, I think the number I I I think I have this. It was in 08 or 09 or 07, it was 2.9 million, and now it's 347,000. Perspective. Perspective, perspective. I think the other thing, it's interesting, uh, Tony. You talked about wage growth. Uh, I I wrote down 50 things that I find interesting in our business. Number 21, not in any particular order. Wage growth will continue to outpace home price growth. That is a win, particularly for the first-time home buyer. I'm gonna ask you another question, but this is something I read that I think speaks to a world we live in today. Americans dropped a record of $12 billion on Black Friday. Oh, wow. We don't have a housing problem. We have a priority and education problem. Yeah. I just I want to think about that for a minute. So it's interesting. My word of the week this week. Uh if you remember last week on weekly update, I used relationship, how important it is to be relational, not transactional. My word uh Friday is going to be education, educating ourselves, educating buyers, educating sellers, uh, educating uh products and mortgage and title and insurance, uh, educating on our sphere of influence and leaning in on them to help us grow our business. Uh, and so I do think that part of what we try to provide you and I on this particular podcast is just some perspective because we think every person tuning in will grow their business in 2026. But you better not do exactly what you did last year because you will get what you got. And so we're gonna challenge everybody to educate at a higher level than ever before so that we can educate the consumer. The consumer needs our education because they are reading headlines for closures up 21%. Home prices going down in these four markets. They're reading and they're not reading the rest of the newspaper. Really, really important. Um, Tony, what else? What else uh strikes you as we talk about uh the kickoff of 2026?

Speaker 40:08

Well, I I want to kind of highlight what you just said in a different way, the education. I think the word in 2026 in most of our markets is also going to be affordability. And I think we edu using your word educate, we need to educate. It's almost like we need to be better financial counselors with sellers and buyers as far as helping buyers get in the door with that financing package. We need to know our mortgage rates. We need to know our mortgage products that a seller could offer a buyer to help them get in the house because it may be that 40-year-old who's never bought a home and they just need a helping hand. Uh the good news is what we're seeing across the board, it looks like property insurance rates are starting to level off. You know, we went through uh some hurricane challenges, um, especially in certain parts of our state, and the rates went up, and now it's starting to level back off. Uh the bigger news right now is property tax uh conversations in every local municipality and assessments, a lot of uh happening there. But to me, the assets performing. It's the values are up, and I am amazed at how many opportunities that we have to help coach our owners who bought a home 10 years ago, and they're saying, my house is worth what? And yeah, it's worth that much. And so there's some opportunity out there for our team to really make a difference for these folks as they evaluate those values out there in the field. That's a big trend in 26 and 27. We're going to hear more and more of as our local local municipalities start to evaluate their assessment values to match the market value. That's that's a big to highlight your word, education.

Sales Pace vs Listing Pace

Speaker 1 41:53

Uh Tony, it's interesting. There there's there's two data points that both say 40%, and I think they're somewhat related, but not totally related. Uh 40% of housing is owned by baby boys. And there's been a theory out there. I'm gonna go back to 2019. And I know I've shared this story a time or two. In uh the fall of 19 when we were preparing our business plan uh for 2020, is we were predicting uh a the silver tsunami was upon us, yeah, where the boomers were gonna right size, the boomers were gonna take their equity. And what we know is two things happened simultaneously. Number one, uh COVID, uh, that was the group that was the most uh you know highly sensitive. And then over the next course of the next four years, all they did was make a ton of money. Um and so the silver tsunami, the 40% of homes owned by baby boomers, is going to happen. Yeah. Uh you know, when I don't know. But if you think about, we were thinking about it in seven, six and a half years ago in the fall of 19, but the dynamics of the market have changed. So we've talked, there's a huge equity stake out there. And and and the and the reason I'm going down this path, I'm gonna go back to a conversation Tony, you and I had uh probably the last two quarters. And I'm gonna go back to the conversation that we had, uh, that is one that our chairman Pat Riley has been talking about for three years, is first-time homebuyer at the average age of 40. I say to myself, think about those boomers or those uh millennials that didn't buy five years ago and how much money they were not making. And so um Tony and I will support Pat Riley's initiative. To parents and grandparents, if you have the ability to help your child or grandchild in a down payment for a home, it does remain the American dream, I believe. I think it will always be one of the top two or three tools to build generational wealth. The data supports that. And so I I just encourage us to think differently, right? If I'm out there as a real estate professional, uh I'm always I'm always talking to the first-time homebuyer because I don't have a house to sell. I'm always talking to a renter because I can do the rent versus buy. You better start talking to the baby boomer. Now, my favorite story about the baby boomer is like you go to the baby boomer's house and you're touring it, and the baby boomer says, Gosh, I just renovated the house, and you say when, and they say 1987. So that is a favorite of the baby boomer thought process. Uh what do you what like what do you think, Tony? Uh because I think we have to help, we have to help educate, we talked about a minute ago, but to create some market opportunities in a much more proactive way.

Mountains Rebound And Local Resilience

Speaker 45:05

Yeah. Well, we're already seeing that that tsunami wave, as you say, the um the boomers are one of the agents in Winston-Salem I was talking to the other day just sold a house built in 1980. And she said, guess when the last time the seller touched the house in any kind of reinnovation was 1980. But to your point, the seller did very well financially, but they had to get very realistic with the price. They had to put perspective on. I've been here, what, four decades? So what should I gain? But the buyer who came in, you have to have a buyer who has an open mind about wanting to renovate a full house. It was a four-bedroom, it was a pretty big house. That's a big investment, but the buyer was creative, could visualize, and that's exactly what they wanted. It'll probably take this buyer one to two years to renovate this house completely. But the seller had to reduce their price in order to, you got to make up for that renovation cost that you got, but you're still getting an appreciation. That's the headwinds that we have to figure out with the conversations between those two groups. The buyer wants to really reduce really greatly to renovate. The seller wants to make as much as they can. That's a big gap in there, but they met, and probably the seller in this case got 75% of what she thought she was going to get, but she came out ahead. Um, she so pretend you you paid $100,000 for it in 1980. You're selling it for $700,000 now. You did pretty good. Well, I thought I should get $900,000. No, you get you got $200,000.

Speaker 1 46:39

My neighbor got $780. My neighbor got $780, yeah, and my and mine was nicer. Like as my father used to say, bears get rich, bulls get rich, and pigs get slaughtered. Um and again, I think, but but you know, one of the things you and I spoke about, and I want to ask you this question. Uh, you know, the last three years, existing home sales have been about four million. Yeah. For the past 25 years, that average is like 5.2 million. One of the conversations you and I had a coup three 90 days ago, Tony, was it appears that looking at historical numbers, this country will sell four million existing homes because people need to buy and sell. When you get to 5 million, I call it the discretionary purchase. You know, I don't have to, but I want to. I bought the wrong house in the fury uh of COVID. Right. To your point. I'm 18 miles away and now I got to go down to the Bank of America and go to work.

Speaker 2 47:40

Yeah.

Speaker 1 47:41

And so I do think that uh you know that that's really uh kind of important information to think through. So um I I just I share that a little bit for for us to to to think about.

Speaker 47:53

Um let me let me comment on that. I'm gonna call it the sales pace. Go back to where we started with the listing pace. In the Carolinas and all our regions, we were somewhere ending the year between 15 to 25 percent more active for sales signs in the in the in the yards. The buyer pace was positive in 2025, but not at 15 to 25 percent pace. What I pulled was somewhere between 2% to 10%. So if you've got, let's just pretend the high, if you've got a sales pace of 10% and you've got a listing pace of 25%, there is a gap that's impacting a couple things. One, it's impacting competition. So you got to hit the market right to begin with. Buyers are taking their time versus three years ago. They're being very intentional versus emotional, like we talked about. And the monthly supply of inventory, which we haven't talked about, is really balancing out. And it's anywhere we haven't been lower in any market that I've tracked under three months for the first time in about two years. But we're really starting to get towards four. And in some markets, like your hyperlocal, I've seen a couple sixes. So three to six months, and we've always been trained that that's a very balanced, healthy market where both the buyer and seller are negotiating. The other thing is I'm starting to see some headlines about buyer's market. I don't think we're there, but there are some trends in certain price points, certain areas that you're probably gonna have to negotiate a little higher, but we're not in a buyer's market that I'm aware of anywhere. But we're trending sometimes that way. And that's when you got to really know your stats every week or every month, because it could happen in certain price points and areas.

Speaker 1 49:36

Well, I think to your point, I I think uh in looking at the data that you and I shared with one another, uh, you know, Asheville and the high country are pushing six. Charlotte is barely over three.

Speaker 2 49:49

Yeah. Right.

Speaker 1 49:50

And again, you know, we will be a broken record uh for sure. It is hyper, hyper local.

Database Discipline And Demand Signals

Speaker 49:56

Uh real real quick on the mountains, just a just a kudos to the people in Nashville and the people in the high country surviving that hurricane. I will tell you of all the strong surges of real estate activity, was the second half of 2025 in the mountains. It looked like a much different market, much healthier, because in the first half of 2025, we were in that recovery mode. And boy, did we see some positive gains. That was fun to see that in the second half, but kudos to everybody who lives in those markets. God knows what it's like to go through a hurricane, but they have recovered in a good way and moving in the right direction, and the markets are starting to speak to that as well. So just a shout out to our our folks in the in the mountain mountains.

Speaker 1 50:40

Yeah, an incredible, resilient response uh to a tragedy. A couple things, uh, a little off uh script a little bit, Tony. Uh I know that uh Dave Childers, who's uh one of our favorites and I think one of many of our listeners' favorites, he did an exercise at an event we had, and he said, I went everybody to pull out their phone. And he said, I just, you know, how many contacts do you have in your phone? Whatever. We all have a lot. Uh some that we touch frequently, some we don't even know who they are, right? I and uh number one to everybody clean that up. That would be uh a takeaway. Uh database is the key to I I say your database is your retirement, it's your currency, and it's the singular most significant thing you can pay attention to at all. And um what's interesting, Dave says five percent of every name in your phone will buy or sell this year. So I'll just think about now. The problem is you don't know which five. Right challenging your database. Uh the other interesting number that I saw is 90% of the prospective buyers, there was there was a group of people polled prospective buyers. 90% of the prospective buyers, as identified by themselves, said, I'm going to buy in 2026. I'm going to buy a house in 2026. And so if you just take those two things, buyers are going to be more, they're going to be, hey, they're going to be a little more patient, Tony, right? Because they can be. They got more choices, they don't have to do it in a day, etc. Again, I I just I think that this information is so critically important to understand, but then understand how you can use it with buyers and sellers to get them to think andor rethink about their current situation. And and again, we talked about it earlier with a home physical or what they call a pair professional equity uh assessment report. I think that in 2026, if I were out listing and selling every day like I did years ago, I would make it a point to do a home physical or a pair every single day. Even if that's just simply running a market study, a market analysis, and mailing it to my sphere. The consumer, buyer seller today must be better educated by us than others that are not experts. And I'm I'm gonna just really challenge every single person listening, every single real estate professional to think about doing what you do a little bit different. And we've thrown away, we've thrown around a lot of ideas today. Take one or two. Don't take the 10, take one or two. Tony, what else? Uh let's talk about interest rates. We talked about a little bit. The big question is, will it start with a five at some point in 2026?

Final Playbook And 2026 Outlook

Speaker 53:53

Well, my gut instinct is yes. Um, I have heard two agents in the last week lock their clients in below six for the first time. Um, there were two moments, September of 2024 and September of 2025, where we saw that happen for like one or two weeks. But now I'm starting to hear, no, with right credit or with the right score, what you we're starting to see it. I think we got down to 6.1 about two weeks ago. So we are really close to being just under five, uh under six percent into the fives. Everything I read says it should get to about five and a half sometime this year, but you never know. We'll see. But I think the potential to get into the fives right now is strong. And I think, again, if I go back to our comments about seller concessions, you definitely can buy a rate down into the sixes at a pretty good rate, in my opinion, meaning a good cost investment. Well, why not negotiate then in the contract and get down in there? And I do think, to your point, I think that's going to pull a lot of people out into the market again this year.

Speaker 1 54:58

Well, what they say is if interest rates drop 1% from where it sits today, five and a half million fence sitters get off the fence. That's right. My only recommendation to everybody is don't wait for it to start with a five to get in the game. That's right. Um, you know, it's interesting. Uh, you know, I read this this morning and it reminded me of uh our conversation, Tony. The best time to plant a tree was 20 years ago. Uh the second best time. And so uh the best time to buy a house would have been 20 years ago. Second best time is today. And again, uh, I just I think we think the market's gonna be uh an opportunity. Uh you know, pricing is really critically important. Uh you and I have talked about that. The second uh uh real podcast in a row. Um let's wrap a ball around it, Tony. We've gone 55 minutes. You and I could go for another 55 minutes. I I enjoy talking to you about our business, your passion for it, your knowledge about it, uh, your commitment to uh your our people, a commitment to the community. Tony just uh spoke to a couple groups this week, whether it be home builders or community advocate groups. You know, how how do we educate? Again, we've we've been pounding education, and uh both he and I need to do uh continue to get out in the market and try to help all of us. Uh one final takeaway for our uh listener today, Tony. Thanks for being with me. Always a treat.

Speaker 56:24

My pleasure. Thanks for having me. Uh I just I go back to where we started. It's it's actually fun to be in a healthy market, you know. And uh I know there are a lot of our agents who started their careers in 21, 22, and there's some of those agents are struggling right now because they've never been in a healthy, balanced market. But it's to me, it's it's fun when you have a buyer and seller both sitting at the table. So my only advice is just like those buyers, everybody be more intentional, be more aware, stay in flow with your clients, like you talked about, Gary, with your database. Uh I think the more we educate people on the opportunities, I think buy a house when you need to buy a house. Sell a house when you need to sell a house, because you cannot time this stuff. I've done it. I personally have tried to time a mortgage rate on a refinance, and I said, nope, I'm gonna wait, and I paid the price. Do it when it's right. And I do think this is gonna be a good year for everybody. A lot of uncertainty in the world is kind of out between elections, economic issues. Um the job growth has been really good in the Carolinas. I think a lot of people feel very confident this year. And as we get into a very healthy 6% mortgage rate and maybe below, you really have some good opportunities to get out there and talk and position yourself differently. So let's go get it. I think 26 is going to be a good year. Awesome.

Speaker 1 57:44

Awesome. Uh it's interesting. You made mention about uh business development in the Carolinas. North Carolina made a record-breaking announcement over the course of 25,000, 330,000 new jobs and $23 billion of investments they've made to bring businesses into our great market area. So a couple takeaways. Uh, if you've got a business journal in your market, read it, uh cover to cover, chapter to verse, right? Because it does provide opportunities. Uh, it'll be about a new subdivision coming or a new company coming into town. You know, stay informed. I talked about database a minute ago, Tony. Your database is not just a list, it's your ecosystem, it's your retirement, and it's your most valuable currency. And then uh I love this, and I'll leave it with this. Calendar equals strategy. If your earning hours aren't blocked, you're simply not serious about this business. So I echo Tony. 26 is a year of opportunity. I'm gonna leave you with two more stats that Tony and I talked about that to me says I'm gonna win 2026. NAR just released a study. 71.6% of every licensee in in NAR did not do a deal last year. And only 86% did four or less. The intentional, the focused, and those with a plan, it is there to be had. It goes on to say a belief that 30% of those individuals of the 71 won't be here. I know the folks that are listening from our company are in that other set of percentages. And we know that we'll gonna lean in on this opportunity that 26 has in store for us. So, Tony Jarrett, uh, appreciate the the wrap up of of uh 2025 and a little bit of a kickoff uh for 2026. Always a pleasure to our listeners. Uh, we'll see you in about 90, or we'll hear you in about you'll hear us in about 90 days. Be safe. Uh, another winter of Wonderland coming in. TJ, I'll see you soon, partner.

Speaker 59:53

Thanks for having me.

Speaker 1 59:54

Take care.