The following article includes views from Reports on Housing by Steven Thomas and other economic experts. It is not a reflection of the opinions, views, or predictions of Nuvision and its representatives. 

Over the last couple of weeks, housing market data has given real estate experts hope that the market may be showing signs of stabilization.

According to data released by the National Association of Realtors, signed contracts to buy existing homes in the U.S. rose in February, marking the third-straight monthly increase. At the same time, U.S. home-building sentiment rose for the third-straight month.

"Even as builders continue to deal with stubbornly high construction costs and material supply chain disruptions, they continue to report strong pent-up demand as buyers are waiting for interest rates to drop and turning more to the new home market due to a shortage of existing inventory," National Association of Home Builders Chairman Alicia Huey wrote in a press release."

Data also suggests the end of a 12-month slide in existing home sales, according to data from the National Association of Realtors. Existing-home sales jumped 14.5% in February to a seasonally adjusted annual rate of 4.58 million, reversing a 12-month slide and representing the largest monthly percentage increase since July 2020.

Housing market analysts are divided over the data.

While much of the latest data has been positive, housing market analysts are still deeply divided as we move into spring homebuying season. In fact, while Zillow expects U.S. home values to rise 0.5% between January 2023 and January 2024, Moody's Analytics predicts U.S. home prices to fall 4% in 2023 and in 2024."

Real estate expert Steven Thomas says this year's housing market is playing out much differently than expected.

"Nobody anticipated buyers bumping into each other with very few available homes to purchase, throngs of buyers cramming into weekend open houses, and bidding wars that result in multiple offers and sales prices above their asking prices. With today's high mortgage rate environment, values were expected to continue to fall throughout 2023. That is precisely what occurred in the second half of 2022 when mortgage rates continued to soar higher, buyer demand plunged, and the inventory climbed and peaked at its highest level in two years. But that all changed as the inventory plunged to crisis levels."

Declining rates seem to be bringing some shoppers back into the market. 

"Application activity increased as mortgage rates declined for the third straight week," said Joel Kan, vice president, and deputy chief economist at Mortgage Bankers Association, in a press statement. "Home-price growth has slowed markedly in many parts of the country, which has helped to improve buyers' purchasing power."

So where are we heading? Thomas says, "As rates drop, affordability will improve, and buyer demand will rise. Stronger demand will heat the market further."