Don’t get caught up in the moment. It’s still a great time to be in real estate – or to be looking for a home.
Yes, there’s plenty of talk of a summer slowdown, and some of us already feel a squeeze.
However, inventory is up, and there’s still plenty of buyer demand out there – despite rising interest rates and inflation. In fact, Auburn ranks 82 out of 100 on Redfin’s scale, meaning the market here is still “very competitive.”
It’s been a great run so far, and here are four reasons the party should keep going for us and our buyers and sellers.
Historically speaking, mortgage rates are still low.
From 1970 to 2008, the average 30-year fixed mortgage rate never fell below 5% and was as high as 18.5% in 1981. Mortgage rates lately have been rising historically quickly, but to historically normal levels. We know buyers may feel like they’ve missed the boat on buying a home but purchasing now can still be a good long-term investment.
Inventory is finally rising. Thanks to all those factors, housing inventory increased in May for the first time since June 2019. Higher inventory and interest rates mean prices will stabilize over the coming months, a welcome relief to buyers after seeing a record 20.6% spike in prices over the past year. Sellers also know how hot the market has been lately, and certainly don’t want to be left behind either.
It’s a correction, not a crash. The last two years of low inventory and low interest rates have kept demand high while prices skyrocketed. Instead of tanking prices, higher rates and inventory should stabilize prices and bring equilibrium to the housing market so both buyers and sellers can thrive.
Interest rates are only temporary. Rates are rising right now, but it’s important that buyers know they have options when and if the rates start going down again. Yes, adjustable-rate mortgages are back, but that’s not what we’re talking about. We’re talking about refinancing! Remember that? While it may feel like a trend of the past, don’t forget that it is likely a viable avenue down the road. A new home can be forever; a high interest rate doesn’t have to be.
It’s important to surround yourself with partners and providers who want to help you thrive. Our team is here to help you navigate whatever happens in the future. We thank you for always trusting us for your title and closing work to Placer Title Company. Together, we’ll get our customers to the finish line all season long.