Here’s what buyers need to know about today’s housing market.
As you know, interest rates have spiked to a little over 6% since the beginning of the year. That’s not great news for buyers, as rising rates mean that fewer buyers can afford homes. In turn, the demand for homes has decreased by 32% since January. These factors combined have resulted in inventory rising by 143% compared to the start of 2022. The time that homes spend on the market increased from 19 days in March to 42 days in June, showing that homes are staying on the market longer than we’ve been accustomed to.
These numbers may sound high, but homebuyers don’t need to worry. Though interest rates have doubled since January, if you buy a home with a 30-year fixed loan now, you’ll lock in that rate for the life of the loan. That means you can always refinance your home when rates drop down again.
“You won’t have to worry about paying over asking price just to compete.”
I also want to share an option for homebuyers that you might have heard about: the down rate option. As real estate professionals, we’ll negotiate with the sellers to give you a credit toward buying down your rate. You could potentially take your rate from 6% down to 5.25% or even 5%. Depending on your purchase price, your monthly payment could drop by a few hundred dollars. Not only that, the credit that the seller offers you is tax-deductible.
Now that the frenzy of buyers we’ve seen over the past two years has lessened, we can negotiate a better price for you. You won’t have to worry about paying over asking price just to compete, and the increase in inventory means you’ll have more options.
If you have any questions or would like more information about what’s going on in the market, give me a call or send me an email. Hope to hear from you soon!
