You might be wondering what is really going on with the effect of mortgage rates on the market?!
Early this year, we started seeing many experts who were forecasting declines in housing prices repeatedly use the word “surprising” and revising their forecasts for 2023.
2022 saw rates double after they hit historic lows during the pandemic. And then they leveled off and have actually gone down since November. Those of us on the street can tell you, they aren’t stopping serious buyers.
“Two dynamics are keeping existing-home inventory historically low – rate-locked existing homeowners and the fear of not finding something to buy.” Then there’s the clickbait about foreclosures being up… Much like the rates, they went up because they’ve been so far down and we’re frozen in 2020. So, while they were a hundred and fifteen percent (115%) over 2021, – they are down 34% from 2019, and 89% less than 2010, and that’s nationwide. Hyper locally this activity is practically non-existent.
“The bottom line is, there will be an increase in foreclosures but there will not be a huge wave of distressed sales as happened following the housing bubble. The distressed sales during the housing bust led to cascading price declines, and that won’t happen this time according to Bill McBride (Founder of CalculatedRisk). The prices continue to hold steady as new listings continue to lag below previous years.
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