Mortgage rates have climbed to over 7%, disappointing hopes for lower rates. While experts predict a gradual decline to 6.5% by year-end, the Fed's stance indicates further cuts are unlikely. Higher rates may persist, but home buyers could still benefit from limited housing stock and new construction options. Those who can secure current rates may gain an advantage in competition and future refinancing opportunities.
Home sales dropped in March due to rising mortgage rates around 7.5%. The number of homes for sale has increased, but it's not enough to offset the impact of higher borrowing costs. The median home price hit a record $393,500. First-time buyers are struggling with affordability challenges, while investors are pulling back. The housing market is stuck in a narrow range, with sales low due to affordability and inventory shortages.
US home prices are rising again, following the pre-pandemic trend of a 0.6% monthly increase. While prices are growing, inventory is still low, with buyers frustrated by high mortgage rates and sellers disappointed by offers. This creates a difficult market where neither buyers nor sellers are fully satisfied. New home sales are increasing as buyers turn to builders for more affordable options, but this is not enough to solve the housing supply shortage.
The National Association of Realtors has eliminated rules on commission rates, allowing for more flexibility in negotiations between agents and clients. This change comes in response to lawsuits and aims to provide more options for buyers and sellers. While some agents express concerns, buyers may benefit from potentially lower fees and increased opportunities in the competitive housing market. The full impact on home prices and the industry remains to be determined.
