Our quick take on rates & an update on today's market.
So, I could write a book here about real estate and talk for hours about the different things impacting the market. It also would be pretty darn amazing if I had a crystal ball (?!!!). But since I don't, I will just give you a quick update on what we are seeing.
Yes, the real estate market is cooling off a bit (just in time for our special Koozies, if you get one you'll know what I mean!) - it almost feels like an early July, when the market ALWAYS cools off as we head into the summer. That said, I wrote an offer last week that was up against 11, yes ELEVEN, other offers. Considering it wasn't the 20 or 30 offers we have seen nor was the winning bid (ours, luckily!) 20% over asking like we have also seen, I guess that was a win. But we also have listings that haven't sold, are seeing tons of price drops and homes that we expected to sell in the first weekend.. not sell, and having luck with some buyers getting homes under asking.. yes, under asking!
The market is funny right now. That is the only way I can think to describe it. Inventory is still low and sales are down - a trend we expect to continue. Less homes to sell equates to less homes being sold. If the Feds keep pushing rates it may continue to slow things down and stabilize the market a bit - we NEEDED this to happen after these last two years of living in the wild wild west of real estate... but, the trade off of higher rates stabilizing prices at the cost of higher rates, equates to buyers getting the same house at a lower price, higher rate and the same (or higher!) monthly payment. We've had multiple buyers in the last week tell us they are taking a break to "wait out the market" or that they are lowering their budget a bit because they just can't afford anymore what they could a few months ago with a rate that's this much higher.
I have also had buyers think rates are much higher than they actually are, which brings us to the point of this email. They are NOT 7%!! As of this yesterday, one of our go-to mortgage guys has a rate of 4.75% for a 30 year fixed jumbo & 5.5% for a conforming. That's with a 20% down payment and can fluctuate lender to lender, so it's good to shop around and ask your realtor (hopefully us!) if the rate you're getting seems competitive. Yes, they are higher than we've been used to these last few years, but remember: buying a home now is essentially locking in your long-term debt. And most experts believe real estate is a good hedge against inflation - because ultimately real estate prices tend to stay on an upwards curve.
SO: marry the house, date the rate. What does this mean? It means if you love a house and can still afford the payment, now is an excellent time to get out there and buy... especially if this is your forever home or you plan to stay in for 5-7+ years. Date the rate can mean shop around for the best rate, or if rates do go down again, consider refinancing in the future. SO many of our clients refinanced over these last few years (& built some great equity in a short time!). There may be some really great opportunities these next couple months while other buyers sit back to wait and see...
The question is, what are you waiting for?!!!
Ok, that's my spiel... Have a great week and hope everyone's summer is off to a fabulous start!!!
-Melanie & her team
