My Credit Plan Blog


Latest News and Updates


The last few weeks have seen some of the highest interest rates for mortgages seen in almost 15 years. Rates jumped from the low 5.00% on a 30 year fixed rate mortgage to about 6.50% before settling back closer to 6.00%. With rates jumping so much, where does the housing market go from here? There are already some signs.

The problems are many. With home prices rising over 30% in many areas of the country, and now with interest rates have increasing since the start 2022, it puts many American dreams on hold. As one real estate broker chimed in, the market has rapidly changed from a seller’s market to a buyer’s market.

New home construction has come to a screeching halt. Some homebuilders are not taking any new applications because they have many homes under construction, and have lost lots of those homebuyers from an inability to qualify now with higher interest rates. Most homebuyers are losing more sales than picking up new contracts. A measure from two fairly big regional builders shows that cancellations outnumbered purchased contracts 4 to 1 in the month of May. That means many homebuyers are walking from their new homes, even if the home is in the closing phase of construction.

Many families waited until school got out before listing their home. More and more homes are showing up on the market. Unfortunately, many listing realtors are seeing very few prospective homebuyers walking through. Just 12 months ago, a newly listed home would often see multiple offers within a day or two in many parts of the country.

Those homes with higher sales prices are definitely sitting now with little activity – close to a million dollars. The only activity – albeit very restricted – is the homes with sales prices in the lower end of the market.

What does this mean? An experienced appraiser said that more expensive homes are showing some minimal declines in value in certain parts. He also said the declines could hit all types of housing.  He even referenced a some purchase offer that were in the lower range where the buyers ended up just purchasing the homes for less than the asking price.

If you are going to be a home seller, there could be some challenging days ahead. If you are looking to purchase a home within the next 6 to 12 months, there will be some possibilities come up. Don’t panic. Prices look to adjust some and could very well create an attractive opportunity for you at the right price.

Remember, it looks to be a buyer’s market for at least the rest of the year.

Showing 0 Comment

Comments are closed.