By Samantha Delouya, CNN
(CNN) — For more than two years, David and Lindsay Lepinsky bid over asking price, waived contingencies and stretched their budget in central New Jersey’s brutally competitive housing market. Still, their offers kept getting passed over as homes sold for tens – and sometimes hundreds – of thousands of dollars above list price.
“It really gets you down when you put offers $100,000 over asking and you get blown out of the water,” David Lepinsky told CNN.
David, 36, and Lindsay, 34, were set on finding a home in the area before they started a family, but they were shopping in one of the country’s strongest seller’s markets, where demand far outpaces the number of homes for sale and buyers are forced to compete fiercely for limited inventory.
Five years ago, much of the country looked like the market the Lepinskys encountered in New Jersey. Rock-bottom mortgage rates and a pandemic-era rush for more space fueled a nationwide homebuying frenzy. Today, the housing market has become far more divided: In some parts of the country, sellers still hold all the power. In others, buyers are finally gaining leverage.
“Nationally, we’re in a seller’s market, but we’re moving out of it,” said Brad Case, chief economist at Homes.com. “The process is further along in some areas and not very far along in others.”
In a housing market strained by high home prices and mortgage rates hovering above 6%, whether buyers or sellers hold the upper hand can often determine who is able to afford a home.
Seller’s market vs. buyer’s market
In the simplest terms, a seller’s market emerges when there are more buyers than homes for sale, giving homeowners the upper hand and forcing buyers to compete for limited inventory.
Case said economists use several metrics to gauge whether a market favors buyers or sellers, including how long homes sit on the market, how much inventory is available and whether homes are typically selling above or below asking price.
One common rule of thumb: Markets with more than six months of housing supply tend to favor buyers, while markets with fewer tend to favor sellers.
Even during what is generally considered the busy spring housing season, there are signs that overall power is tilting more toward buyers. In April, there were 4.4 months of unsold housing inventory in the United States, a 5.8% increase from the prior month, according to a recent report from the National Association of Realtors.
Much of the Northeast, including New Jersey, is considered a strong seller’s market, as are parts of the Midwest, including Chicago, and high-demand pockets of California, especially the Bay Area.
Where buyers have more negotiating power
Elsewhere in the country, the balance of power is beginning to shift. Parts of Florida, Texas and other Sun Belt markets that once saw pandemic-era demand spikes are now tilting toward buyers as inventory rises and demand cools.
In some areas, like Texas, the shift is being driven in part by a surge in homebuilding and rising inventory. In others, including parts of Florida and Louisiana, soaring insurance costs are making buyers more hesitant and pushing some homeowners to sell.
Leslie Heindel, a real estate agent in New Orleans, said that in her area, it often feels like buyers hold all the power thes