What’s New in Baltimore Real Estate: Inventory, Interest Rates & Affordability
Welcome to fall! With the changing seasons we also typically see a shift in real estate and this year is no exception. The buzz on Baltimore’s streets these days is a lot of fear and uncertainty surrounding the housing market.
Home prices are high, mortgage rates keep climbing and affordability is at an all-time low. These factors combined are creating a pretty significant slowdown in sales.
Now, it’s important to note that a dip in sales this time of year is completely normal. We typically do see less people list their home over the holidays and buyers tend to hold off on searching as well. However, this year feels extra slow due to so many buyers and sellers waiting for a drop in something (rates, home prices, inflation, etc.) to make a move.
If you’re one of the many who fall into that camp, lean into your real estate agent for guidance (aka Your Home Group)! We’re here to hold your hand and guide you through the haunting ups and downs of the market and give you a little light at the end of the tunnel.
Keep reading to learn more about our current market and how it impacts you!
SELLERS
Alright sellers, here’s the recap of what’s going on with your side of the market:
INVENTORY SHORTAGE = HIGH HOME PRICES
We’re not new to this idea, right? After such a hot market over the last few years, we didn’t expect to face the same inventory shortage. However, this lack of supply isn’t from a pandemic or restricted building materials—but sellers unwilling to list.
Homeowners are starting to get that sinking feeling that their “starter home” might be a little more permanent than they thought. The reason? Their super-duper insanely low mortgage rate they locked-in back in 2021.
That’s right—those 3% rates have been magically transformed into 8%, and sellers aren’t having it. This has resulted in—once again—another shortage of inventory.
So sellers, this is still your time to shine!
The lack of competition is raising the price of homes, so you could still get top dollar on that starter home! And if you’re worried about how to afford a new place with these high mortgage rates—if you can swing it, we highly recommend creating a plan to buy your home now and refi once the rates start to drop.
Economists are telling us that they will. Perhaps not tonight, tomorrow, or even by the end of the year—but they’ll slowly creep back down. And once they do? Expect a buyer frenzy that you just narrowly avoided. Go you!
One final note for sellers… there is a smaller pool of buyers out there. It’s crucial you trust your agent when it comes to pricing your home and be open to giving buyers concessions if needed. Remember, Chuck Norris eats 8% rates for breakfast, but ordinary buyers aren’t Chuck Norris.
BUYERS
Hey buyers, let’s have a little heart-to-heart. We know that the housing market is looking a little bleak at the moment. The reason?
HIGH MORTGAGE RATES + HIGH HOME PRICES = DIFFICULTY AFFORDING A HOME
Everyone in the industry is like a fish on a hook, waiting to get reeled in by the Feds’ decision to lower the mortgage rates. When will it happen? How long will we have to wait? Why isn’t inflation decreasing?
We’re tired of waiting, too—we promise. But we have some hopeful tips that might lift your housing market spirits: Marry the home, date the rate
(cheesy, we know!!)
There’s a good chance you might have heard this saying before. It’s a strategy that works great for some, but not all buyers in the current market.
The concept? Don’t wait until the rates go down. Right now, there are very few buyers in the market, so the competition is pretty bare bone. However, once those rates start to drop, every buyer on the block will flock to what little inventory we have left.
So, to avoid this cat-claw competition, buy a home now, possibly include a buydown and refinance once the rates adjust.
There are quite a few programs that can assist with the affordability of your home until the rates decrease. If this sounds like a good plan for you, reach out to our team today! We’d love to get the ball rolling and strategize how to get you your dream home—without the competition.
No matter if you’re in fight or flight mode, have faith that change is on the horizon! We understand if you’re feeling hesitant about buying or selling, but there are some major benefits when it comes to today’s market. So, if you’re ready to face your fears and tackle the haunting housing market, make sure to reach out to Your Home Group!
