Blog: How is the Real Estate Market? Real Estate News October 2022
Hello, thought I would send out a quick update on the Real Estate Market.
Folks are asking "How bad is the market?"
Higher interest rates are definitely changing the game for sellers and for buyers. And while we hear the Fed announcements - when they say they want to reset the housing market maybe we ought to believe them. If rates went down dramatically, it would bring lots of buyers back, but prices would still be high, so low rates alone don’t solve the affordability issue. This is where price declines today seem necessary for the climate of rates at seven, eight, or nine percent.
There are still not enough homes for sale (about 2.3 months) making it still a sellers market and therefore definitely still at a historical low, but many buyers just lack the affordability. Only just around 15.78% of all purchases this and last year (15.62%) were in cash. In other words some 85% of buyers had to take out a loan in order to purchase. So low housing supply doesn't mean to keep the prices up because the stats are currently showing otherwise and numbers don't lie. Looking at a 10 year review, we are still only 1% down. Today's market looks quite similar to 2019. The last two years were just bananas. If you are like me and like stats and graphs, here are 2 graphs that come from my fav. trusted source, Ryan Lundquist Appraisals - who brings tremendous info for us in Real Estate, esp. creating these graphs. These illustrate the numbers real well.
There are many thoughts from many folks in the business what the housing future will hold but only time will tell for sure. Please keep in mind that “national” housing trends on the internet/TV don’t mean much for local markets. So we always want to focus on the area where you are located. I check the stats and study the market on a hyperlocal level for all my clients and those who are interested. The truth is - in some areas - folks will feel these shifts more than in others.
And the market will adapt and figure this out. It always does. And it is always changing. If rates keep rising, we’re going to see more buyers put their house hunting aside or postpone. But... Bottom line is - this doesn’t mean all buyers and sellers will leave the market. For now, we are missing sales in the greater Sacramento region since May, but many sales have happened within this time period. If you like, I am happy to send some numbers just for YOUR area. Please feel free to contact me. This is a free service I provide, as I believe to bring value to all those who don't have time or the resources to be "in-the-real-estate-know".
I am here for you, for your family and your friends. It would be an honor to assist.
info/courtesy/source: Ryan Lundquist Appraisal Company