|July 2022 REAL ESTATE NEWS|
|Rising Mortgage Rates May Affect Asking Prices If you’ve been paying any amount of attention to the real estate market, you may have noticed that mortgage rates have been steadily increasing throughout most of 2022. In fact, the average interest rate for a 30-year mortgage is over 5% as of early June.
When the Federal Reserve first lowered national interest rates at the start of the COVID-19 pandemic, buyers essentially flooded the market. Now that interest rates are increasing, some sellers are lowering their asking prices to make sure that buyer interest doesn’t begin to wane. If you’re searching for your dream home, you may be able to find it at a reasonable price.
In May 2021, 6.2% of homes reduced their listing prices. During May 2022, this number increased to 10.5% of homes. It may seem like a small adjustment, but it’s not the only indicator.
The number of newly listed homes has increased by 6% over last year, which is another sign of possible price drops to come. The national median home price is still up compared to 2021 and 2020, but if more and more sellers start to reduce their asking prices, this points towards the real estate market shifting back to buyers. When market conditions are favorable to buyers, the negotiating power doesn’t remain solely with the seller. Even if a seller hasn’t dropped their asking price, they may be open to doing so during negotiations.
Even though interest rates are increasing, now is a great time to buy if you have good financials and access to enough funds for the down payment. Even a small decrease in asking prices and buyer competition should give you a better opportunity to buy a home at the right price.
|Looking To Buy A Home In A Competitive Market?
Here’s How To Win Now that interest rates and home values are increasing at a somewhat steady rate, you might think that market conditions would start favoring the buyer. Despite recent changes, the market remains highly competitive among buyers. When market conditions are favorable for buyers, you likely won’t encounter much competition while you search for a new home. On the other hand, a competitive buyer’s market typically leads to the seller receiving multiple bids and having more power during negotiations. Even though buying a home in a competitive market is more challenging, it’s certainly not impossible. Here are some tips on how to win when searching for a new home.
Make a Strong Initial Offer
Don’t Rush into a Purchase
Buying a home in a competitive market is possible if you pay attention to the tips and guidelines mentioned above. If you receive a preapproval letter from your lender, you should be ready to start your search. Once you’ve found the home that you’d like to live in, don’t hesitate to make a strong offer. With the right approach and the right real estate professional by your side, you can be a new homeowner in no time.