Strap in, potential home buyers. The housing market has turned into a redneck family reunion. Mortgage rates have decided to go on a bender and start a fight with grandpa. Housing prices drank a bunch of cough syrup, grabbed a chainsaw, and said, “Hey watch this.”
Basically, it's a giant cluster f*%# that’s causing both financial experts and home buyers to be very, very confused.
Why is the housing market so crazy right now?
Here’s Five Fast Facts About Erratic Housing Market Behavior:
- 🏠 Predictable - Before rate increases, 30-year mortgages hadn’t gone above 4% since 2019! That’s super impressive. In March 2022, the Fed pulled the trigger and increased rates to 4.42%. Things took off from there. 🚀
- 🤪 Unpredictable - In November rates hit 7% and slowly started dropping. Then, in the beginning of July they hit 6.81%. They’re climbing back upward for no apparent reason.
- 😱 Spastic - Housing prices are bouncing all over the place, too. In May, the median price of a new home was $416,300. That’s down 7% from May of 2022, but up 3.5% on a month-to-month basis. Again, dropping but then climbing back up.
- 😨 Uncertain - Financial experts are unable to predict what’s going to happen if government officials raise the rate again. Unfortunately, all signs point to that happening soon. Normally an increase would cause a drop in rates, but who knows anymore.
- 🔒 Locked Down - What’s making this even worse? You still won’t find many homes for sale. In fact, the inventory continues to drop because current owners don’t want to move and risk a higher mortgage rate than what they already have. Plus, the number of available homes has gone down by almost a million since 2017 and it doesn’t look like there’s an increase any time soon.
🔥Bottom line: Anarchy! Chaos! Mass Hysteria! That’s the housing market in a nutshell right now. And much like a broken carnival ride, no one knows when it’ll stop. One thing’s for certain, though: buying a house is going to be super expensive for the foreseeable future.
Are you having a tough time buying or selling a home right now? What do you think?
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