The real estate market is definitely feeling the effects of rising interest rates. Overall, homes under contract in April were down 15% from the previous year. Yes, that can be attributed to less inventory which is down 30% year over year but with interest rates touching 6% now we are seeing buyers start to second guess buying now and / or waiting for the market to start to come back down to earth before moving forward. The chart will show the significant rise in interest rates that has happened in the last 6 months.
This is a good thing as I believe the reduction of demand will allow more homes to stay on the market so that, in turn, will give sellers more options to move to and then they decide to sell. What will be interesting to watch is how much inventory hits the market as the pent up supply of sellers decide to list.
If you’re a seller and already have a place to go then I would highly recommend you take advantage of the prices now. I do feel when summer gets here, we will not be able to get the prices that homes are selling for now.
We are already seeing less showings on our listings as demand is fading. That being said, it is still a very strong sellers market but maybe only 20 - 30 showings a couple of days in as opposed to the 80 – 100 we had at this point last year.