Home News I’m the chief economist for a $5 billion real estate data and title company. Here are 5 things you need to know about the housing market now

I’m the chief economist for a $5 billion real estate data and title company. Here are 5 things you need to know about the housing market now

by admin
0 comment

Mark Fleming

Homes are becoming more and more affordable for millions of Americans, and home prices and mortgage rates continue to rise (“See here the lowest rates you may qualify now).So – as part of our series Here, we asked prominent economists and real estate professionals about their commitment to the housing market. I talked to Mark Fleming. Fleming, Chief Economist at First American Financial Corporation, a title, payments, real estate data and risk solutions company, has been analyzing and forecasting the real estate and mortgage markets for 20 years. Prior to becoming First American’s Chief Economist, Fleming developed Core Logic’s insights and analytics products, as well as Fannie Mae’s evaluation model. Currently, his research expertise includes real estate, urban economics, and mortgage risk. So we asked Fleming: What do buyers and sellers today need to know about the housing market?

Mortgage rates are high, but still not high

It’s significantly higher than it was three months ago, when it slowed down home buying power, but it’s about 6% for a 30-year fixed-rate mortgage, which is by no means high, according to Fleming. “Mortgage rates are high, but not by historical standards,” says Fleming. He has a point: this The St. Louis Fed chart shows the mortgage rate curve since 1975. ((See here the lowest rates you can qualify.. )

Affordability is becoming an increasingly challenging issue for buyers

House prices have risen sharply over the last two years. In fact, according to data from the National Association of Real Estate Agents, the average selling price of existing homes has risen 17% from last year. “This is important because it is virtually impossible for home-buying power to catch up, resulting in lower affordability,” says Fleming.

According to Fleming, the rise in home prices measured by many of the media’s home price indexes can sometimes be as long as six months behind. “It will take a few more months before the home price index reflects how the mortgage rate surge in the second quarter responded,” says Fleming.

Prepare for slower housing price growth

However, just because affordability is an issue does not mean that home prices will go down. According to Fleming’s research, in an era of rising mortgage rates, as we are experiencing today, home sales tend to decline, but home prices generally do not. “We expect lower sales and lower prices,” says Fleming.

The housing market is chilling

Monitor inventory levels and list seller price cuts. “These are key indicators of where prices go and how rising mortgage rates have affected demand. More inventories and more sellers’ price cuts indicate a chill in the market. “I am,” says Fleming. For sellers, this means resetting expectations of how fast their homes will sell. “The days on the market were never normal. In fact, in the old saying, sellers usually had to expect a home to sell for up to three months in the market. Of course, we. Is still far from that, but sellers should expect it to take longer to sell their homes. For buyers, expect less competition to buy a home, “Fleming said. say. ((((See here the lowest rates you can qualify.. )

Consider ARM and become a smart shopper

Given the current market, Fleming says it’s easy to lose focus in changing mortgage rates and other housing dynamics. “In reality, some basic steps are still important and not much different from other markets. Search for the best mortgages and look for floating rate mortgages in a market with rising interest rates. Make your choices based on your home as a shelter and be patient, not on investment return opportunities, “says Fleming.

You may also like