Thinking about buying a home? You might want to hold onto your wallet for a bit longer. The latest report from the National Association of Realtors shows that pending home sales – that’s deals in progress but not yet closed – have hit rock bottom. In fact, they’re at the lowest level since records began way back in 2001. Yikes!
So, what’s the deal? It’s like a perfect storm of housing woes. There aren’t enough homes for sale, and the ones that are available come with eye-watering price tags. Add to that mortgage rates above 6% (remember when they were around 3% in 2021?), and you’ve got a recipe for a seriously sluggish housing market. It’s enough to make even the most eager house-hunters think twice.
But here’s where it gets interesting. Many current homeowners are sitting pretty with mortgages below 6%, making them reluctant to sell and lose that sweet deal. It’s like they’re locked in a golden cage of low interest rates. Meanwhile, potential buyers who can afford today’s prices are playing the waiting game, hoping for lower mortgage rates down the road. And let’s not forget the upcoming presidential election, which is adding an extra layer of “who knows what’ll happen next?” to the mix.
Now, before you start dreaming of snagging a bargain, hold your horses. Even with all this uncertainty, home prices might not necessarily drop. If mortgage rates do decrease, it could bring more buyers back into the market, potentially driving prices up again. So, whether you’re looking to buy or sell, keep your eyes peeled and your financial ducks in a row. The housing market might be unpredictable, but being prepared never goes out of style.
