Sales Are Climbing… But So Are Mortgage Rates
After near-record lows in the month of July, interest rates are on track to bounce back up towards where they were this spring. Additionally, the number of new listings on the market as well as closed home sales continues to slowly increase, suggesting that the inventory of homes for sale is catching up with market demands.
This could be the beginning of the end of the current buying frenzy so act now before it’s too late!
What’s Going on With Mortgages?
The above chart tracks the average mortgage rates for 2021 and while July brought in rates at a six-month low, early data is showing that average rates could shoot back up to their springtime levels by the end of August. While a few tenths of a point may seem insignificant, this can spell out hundreds of dollars on a monthly payment and tens of thousands in interest over the life of the loan.
As interest rates rise, consumers’ buying power decreases and they suddenly aren’t willing to pay the premiums that they could afford earlier in the summer.
What’s Going On in the Market?
The California Association of Realtors reported last week that closed sales were up 3.1% and new listings were up 38%. This suggests that the number of homes on the market is increasing and, as such, so are the number of sales.
At the end of the day, more available homes combined with higher interest rates equate to lower sales prices.
But fret not! There are still many more qualified buyers than available homes and values are still holding strong, at least for now. A sellers’ market can very quickly flip to a buyers’ market and these are the first signs of that taking place so time is of the essence!
With over 35 years in the home selling business, Ultimate Properties has successfully predicted many market trends and, right now, our recommendation is SELL! SELL! SELL!
WE CAN MAKE THE SALE OF YOUR CURRENT HOME 100% CONTINGENT ON YOU FINDING THE HOME OF YOUR DREAMS AND IF YOU DON’T FIND IT, YOU DON’T HAVE TO MOVE.
Let us streamline the process of maximizing the profits on your current home and get you into the home of your dreams! Our direct line is (714) 203-1669 or send an email to office@UltimatePropertiesSold.com.