Answering the most important questions about home prices and rates.
If you’re thinking of buying or selling a home, and you turn on the news, you’ll probably hear about how properties could lose value and how the boom is over in the housing market. Some of the things that are being communicated by the media are often misleading. That’s why today I want to share data and information that answers two of the most important questions about the market:
1. What’s going on with interest rates? We are at an inflection point. Over the last two years, we have seen tremendous demand and limited supply. Now, we have a rise in interest rates and a quick rise in home prices over the last two years. The reality is that mortgage rates have doubled this year alone.
“The median asking price to rent a home has been consistently going up since 1988.”
According to Mark Fleming, the chief economist at First American, “Mortgage rates are expected to continue to drift higher over the coming months, but much of the rapid increase in rates is likely behind us…Nationally, while month-over-month house prices may decline, annual house price declines are not expected given the ongoing supply-demand imbalance and continued strength in the labor market.”
2. What are experts saying about home prices? At 1:41 in the video, there’s a graph that shows the 2023 home price forecast. This is what six of the leading expert economists—including Fannie Mae, Freddie Mac, and MBA—are saying. These real estate companies have access to the best information possible, and the average of all six forecasters is at 1.8% appreciation.
The last point I’d like to share is that the real crisis in today’s market is the cost of renting. Since 1988, the median asking price to rent a home has been consistently going up. When considering buying, it’s critical to consider the cost of renting compared to the cost and financial benefits of homeownership.
I hope you find this information helpful. If you have questions about this topic or need help with your real estate plans, call or email me. I’d love to connect with you!
