Despite 30-year fixed mortgage rates now in the neighborhood of 7%, prices appear to have been holding this fall. That’s because low inventories are keeping sellers from having to compete against each other, and lower their prices to attract offers from a limited buyer pool. While there’s no doubt the buyer pool has gotten shallower as a result of the higher rates, there is still legitimate buying activity in the market.
There are a few implications for Marin and the North Bay:
- Sellers should not be getting nervous, unless their home is obviously overpriced. If a house is on the market and getting lots of attention but no offers, plus it’s had plenty of time to attract buyers, then it’s time to reduce the price.
- Buyers should not anticipate a ‘sky is falling’ seller’s mentality. Even if the buyers think that’s the case, it clearly isn’t, yet.
- We may not see a ‘sky is falling’ situation. Yes, the economy may already be in a recession, inflation is historically high, and the stock market has taken a huge hit this year. There’s no shortage of bad economic and political news. We may not see these factors effecting the real estate market until next summer or fall if inventories stay low. By then hopefully the economy will be in a more positive place.
Seller’s bottom line: don’t be deterred by the current conditions.
Buyer’s bottom line: if you find the house you want and you can afford it, get off the sidelines and make it happen