Lots of attention has been paid to the housing market since 2020 when buyers benefited from historically low rates, through 2022 where sellers consistently entertain multiple cash offers well above their listing price. Anyone watching the market this year has seen an increase in the number of homes on the market paired with a constant influx and decrease of interest rates.
One pattern every party has taken note of is that trends that fair well for buyers often present challenges for sellers and vice versa.
Many factors go into homebuyers’ demand. Mortgage interest rates, availability, location and more. At Merchants & Marine Bank, we understand the challenges both buyers and sellers may encounter, which is exactly why our team in partnership with Canvas Mortgage put together some thoughts about current trends and what’s important to know.
What are the housing market trends, and how do they affect you?
There are more houses on the market, rates are not rising as quickly as they were from mid-August through last month, and buyers aren’t being priced out due to competition like they were.
Home listings are up compared to last year by about 27%. And while the median price of a home continues to rise, it’s not increasing quite as fast as it was earlier in 2022. Still, the median list price for a house was about 14% higher this September than the previous one. Houses are spending about 50 days on the market, which is a week more than last year.
While these signs point to improved conditions for buyers seeking a home, the total number of active housing listings still hasn’t recovered from the COVID pandemic. Combined with higher housing prices and interest rates, some buyers remain priced out of the market. For sellers, even though average time on the market has lengthened and there is less overall competition among buyers, they still see higher returns than previous years.
Is it a bad time to buy a house?
Nearly three-quarters of consumers recently surveyed thought it was a bad time to buy a home, according to September’s Fannie Mae Home Purchase Sentiment Index.
However, there are several factors to consider before closing the door on the idea of a new home purchase. Some housing economists believe that mortgage rates will begin to level out as we go through Q4. Plus, sellers are receiving fewer offers per home and are more likely to accept initial offers or reduce prices.
Everyone needs a place to call their own – whether they rent or buy – and rental rates haven’t been immune to trends in the housing market. The sticker shock of rental rates this past year has motivated many renters to pivot and consider building equity in a home. Plus, economists anticipate above-average rent price gains in 2023.
It’s hard to time the market, so it may be best to look for signs that you are ready for a new home. The best signs are good credit, savings for a down payment and any unexpected expenses, and a willingness to stay in the home long enough to ride out the ups and downs of the market.
Work with an Expert
Merchants & Marine Bank is invested in the needs of our clients. Through our Canvas Mortgage division, we are dedicated to helping navigate the housing market and find the best financing solutions for you. Contact Canvas Mortgage today to learn more about our services and what our team can do for you.