The housing market is intriguing. Despite low supply, sales are slowing due to high mortgage rates. However, new listings are gradually increasing. Interest rates are the key factor, as higher rates suppress demand. Lack of inventory prevents a price collapse but balances out the market. A rate drop could lead to more sales. High rates are having an inflationary impact as people spend less on housing but more on other things. However, apartment construction is slowing, which could create future supply issues and inflation concerns.
Rent prices in March rose slightly due to seasonal patterns and increased demand during warmer months. However, some markets, like those in the Sun Belt and inner mountain areas, including Arizona, are experiencing rent decreases due to increased supply. While prices have increased overall, they remain lower than in 2021 and 2022 due to a return to seasonal patterns and factors like supply and demand. Markets in the Midwest and Northeast continue to see high rent prices due to undersupply.
