With so much attention focused on the stock market, the housing market has faded into the background a bit. Sellers have been reluctant to give up their older 3% mortgages to buy another, more expensive house. And buyers balked at the current 6% mortgage level – completely forgetting that 40 years ago many homebuyers were willing to accept double-digit interest rates!

But just as all markets cycle up and down, the housing market seems to be entering a new phase. Redfin reported that in December more than 40,000 home purchase contracts were cancelled, the highest level in a decade. And the Wall Street Journal just headlined: “The Housing Market is Swinging Toward Buyers.” The article says: “The U.S. housing market had over 600,000 more sellers than buyers in December, the biggest such gap on record in seasonally adjusted data going back to 2013.”

So if you are ready, you might suddenly find the opportunity to enter the housing market at a far more reasonable price, with far more affordable monthly payments.

Home ownership has always been the basis of the American dream. But there is evidence that either because of affordability or changing job and lifestyles, younger generations have become more skeptical about the benefits of home ownership. A survey by Citigroup suggests that while about 87% of boomers and 83% of Gen X see home ownership as one of the best ways to build wealth, only roughly 77% of millennials and 65% of Gen Z share that opinion.

Baby boomers have benefited most from the rising price of homes over the years. And as they pass on, their heirs are expected to inherit nearly $2.4 Trillion worth of residential real estate in the United States. Because of the current estate tax law, those properties will get a “step-up” in cost basis for the heirs – meaning there will be no tax to pay on all the accumulated gains.

So, it’s a safe bet that real estate is not going out of style. In fact, residential real estate has been such a successful investment that many large institutional investors and private equity firms hold over 100 homes, upon which they earn rent. It’s estimated that they compromise roughly 5% of single family rental investors, versus about 82% “mom and pop” landlords with fewer than 10 properties and 13% mid sized owners.

Have those “professional investors” accumulated enough properties to dent the supply of homes for purchase? The President recently announced he wanted to limit “institutional” ownership of homes, and is expected to put forth a proposal or legislation to that effect in coming weeks in an attempt to free up supply (and create lower prices).

Housing “affordability” is a hot topic whether in New York City or in small rural markets. Yet rental increases have slowed in recent months, and in some areas home prices are starting to come down. Or at least the asking prices on homes for sale are being lowered. According to the latest survey by the National Association of Homebuilders, 40% of builders reported cutting prices in January. The average price reduction was 6% in January, up from the 5% rate in December, according to the survey. And the use of sales incentives was 65% in January, marking the 10th consecutive month this share has exceeded 60%.

There are signs that the housing market logjam is finally beginning to ease. Builders are still in process of building new homes, even as prices may soften. The labor market remains reasonably strong, and unemployment is historically low. Consumer confidence is the wild card – but so far consumers have kept shopping.

Since mortgage rates are based on the 10-year Treasury rate, which in turn reacts to inflation figures, there is little sign that rates are about to rise. The 10-year Treasury has remained in a historically narrow trading range.

Absent a stock market crash that would spook homebuyers, the apparent softening in the housing market means buyers should get prepared to start looking again. Here are the steps you should take if you’re a potential homebuyer:
• First- time homebuyers should check for state programs that offer down-payment assistance or lower mortgage rates in certain locations and zip codes. They should also check with financial institutions that often try to please regulators by offering special mortgage deals to either first-time or low-income homebuyers.
• Clean up your credit report. This is the time to make sure you are current on all your monthly payments and don’t have a lot of credit card debt outstanding. Your credit score will impact your ability to get pre-qualified for a mortgage. And having a mortgage pre-approval can help you convince a seller to lower the price for a quick sale.
• If buying a home is your priority, gather the cash for a down payment. For many, that means family gifts. But it could also mean postponing a vacation trip or new car purchase.
• Know your local market. Not all markets will have the same level of activity or demand. Check listings on Zillow or Realtor.com to see if there’s a sudden swarm of listing price cuts. It’s important to have a feel for the trends in your area.
• Evaluate your job security. There’s nothing worse than buying a home and then losing your job. It puts not only your down payment, but your entire financial security at risk. No one gives job guarantees, but your income sources are critical to your decision to move from being a renter to a buyer.

This is all pretty common sense advice, no matter what your age or stage in life. But like everything else in the world of finance, it pays to have a plan and be ahead of the crowd. That’s the Savage Truth.