Home News I’m the chief economist of Redfin. 5 things to know about the housing market now

I’m the chief economist of Redfin. 5 things to know about the housing market now

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Redfin Chief Economist Daryl Fairweather shares her thoughts and expectations on the housing market.

The peak season for home buying is in full swing, and many aspiring home buyers are wondering. What should I know about the housing market if I want to buy?After all, interest rates are rising and some pros say the trend will continue (See here the lowest mortgage rates you can qualify for); House prices continue to rise. There are not enough homes for buyers in the market. So ask Daryl Fairweather, Redfin’s Chief Economist, who is studying why homeowners are in foreclosure at the Federal Reserve Bank of Boston, to share her predictions and thoughts about what buyers and sellers can expect in the coming months. I requested.

There are early signs that the market is a bit cold in some places

Fairweather says there are early signs that the housing market is starting to cool, at least in the expensive coastal metro. “Buyers who have lost some bid wars in markets such as Los Angeles, San Francisco, Boston, and Seattle may find that they are less competitive with other buyers than they were a month or two ago. “Hmm,” says Fairweather.

See also below. This story is part of a series of questions about the housing market from prominent real estate economists.This is A senior economist at Realtor.com talked about the current housing market.

For this reason, if you’re a local house hunter in popular migration destinations such as Nashville, Atlanta, or Miami, you should expect to compete with buyers in California and New York, who tend to have higher housing budgets. “In Nashville, the average housing budget on the outskirts is nearly 30% higher than the average budget for local buyers,” says Fairweather.

Mortgage rates may continue to rise In the short term

It is a well-known fact that interest rates are rising rapidly. Thanks to these soaring prices and rising home prices, monthly mortgage payments have increased by 30% from a year ago. “We expect interest rates to continue to rise in the short term, so buyers who haven’t fixed their mortgage rates to their lenders need to include that in their budget,” says Fairweather. ((((Look at the lowest mortgage rates you can qualify here.).

House price increases can slow down quickly

As for rising home prices, she expects it to slow soon, given that mortgage rates are rising. “I don’t think home prices will go down, but buyers are relieved to know that the double-digit year-on-year price increases we’re experiencing could drop to single-digit prices in the coming months. Maybe, “says Fairweather.

However, this is not universal in all markets. The popular Sunbelt migration destination may be the most resilient. That is, price increases may continue, but according to Fairweather, house price increases generally begin to balance.

Rent is also very high, so it may not be the best time to move

Buyers currently renting should also be aware that recruitment rents are skyrocketing. “In March, it increased by 17% nationwide, and by about 40% in Austin, Texas, Portland, Oregon, etc. If for some reason you decide to suspend your home search, move to a new rental home. It’s better to keep the current rental agreement than to do it, “Fairweather says. She says this is because the landlord is unlikely to raise the rent for an existing tenant as high as for a newly vacant unit.

Focus on what’s important when buying a home

In this tough market, Fairweather recommends that homebuyers get rid of exterior details such as paint colors, cabinet hardware, old appliances, and luminaires that are relatively easy to replace or repair. increase. “It can lead to low-priced offers at homes that otherwise check all boxes, and in markets where about two-thirds of the offers are facing a bidding war, homes are costly. It’s possible, “says Fairweather. Instead, focus on more important things such as location, square feet, layout, and so on. Once you own a house, you can change its appearance at any time.

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