Here’s what buyers and sellers need to know about our market.
Recently, we’ve seen a lot of shifts in our real estate market. They’ll have a big impact on our future, so today I want to break them down and explain what they mean for you.
One of the biggest stories in the news right now is the war in Ukraine and how it’s affecting the global economy. When you combine that with rising gas prices and inflation, you begin to understand why some people are worried.
On top of that, the Federal Reserve has started increasing mortgage interest rates. They’ve already made a few increases, and I expect we’ll see a few more before the end of the year. As rates increase, your purchasing power decreases. Many buyers have sat on the sidelines, waiting for prices to drop. Instead, affordability has only gone down.
“As rates increase, affordability has decreased.“
Some people are worried about a crash like we saw in 2008, but I’m not concerned. Our market no longer has predatory lending practices, and inventory is historically low. During the last crash, there were too many homes, so when demand fell, prices plummeted. Our market almost has the opposite problem; prices are increasing, and supply can’t keep up with demand.
If you are a buyer in this market, my advice is to jump off the sideline and grab a home before prices and interest rates increase further. It sounds gloomy, but it’s the reality of the situation. Prices aren’t going down anytime soon. On the flip side, this is one of the best times I’ve ever seen to be a seller. Most of the properties I’ve listed in the last 18 months have sold over asking price, and I expect this trend to continue.
If you have any questions about today’s topic, please call or email me. I look forward to hearing from you.