Home News I’m the director of forecasting for the National Association of Realtors. Here are 6 things you should know about the housing market now

I’m the director of forecasting for the National Association of Realtors. Here are 6 things you should know about the housing market now

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As part of a series of questions about prominent economists and real estate professionals about their commitment to the housing market, we spoke with Nadia Evangelow, Senior Economist and Forecasting Director, National Association of Real Estate Agents.

National Real Estate Agents Association

Affordable housing crises are here — mortgage rates continue to rise (See here the lowest rates you can qualify) At the same time, so is the house price.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 Nadia Evangelow. She is a Senior Economist and Forecasting Director at the National Association of Realtors (NAR), focusing on regional and regional market trends, including the impact of changes in demographics and migration patterns. She also specializes in her research and analysis on affordable conditions for local homes and solutions for increasing home inventories. Here is her idea of ​​the current housing market.

Mortgage rates are expected to rise further

According to Bankrate data, mortgage rates on 30-year fixed loans reached about 6% in June, up from just over 3% a year ago. Evangelow says the rise will continue, but not at the same rapid pace. Mortgage rates seem to have already been priced as part of the impact of the Fed’s rate hike, “Evangelou said.

Some buyers are advised to consider ARM

Given the current market, Evangelou states that some buyers should consider taking a floating rate mortgage instead of a fixed rate mortgage. “If you plan to sell or refinance in the next five years, ARM in 5/1 may make more sense because these interest rates are still below 4.5%. Therefore, for a median home, monthly mortgage payments are about $ 300 lower than 30-year mortgage payments, “says Evangelou. You can see here the lowest mortgage rates you can qualify for..

There are signs that the market is chilling

Both rising mortgage rates and home prices are undermining the affordability of many buyers. “As a result, existing home sales have declined over the past four months. We expect significant declines in home sales activity in the next few months, especially in the summer months,” Evangelou said. Says.

And buyers are priced from the market. Still, not all homebuyers can afford these additional homes. According to Evangelou, buyers who earn $ 75,000 can now buy about 25,000 fewer lists compared to January.

Institutional Investors Can Intensify Competition for First-time Buyers

As mortgage rates rise, rents are skyrocketing as affordability is compromised, more people are renting and inventory is low. “For institutional investors, this leads to greater profits. However, the increased market presence of institutional investors will intensify market competition for first-time homebuyers. Research shows institutional investors. May be taking advantage of a significant portion of the homes that would otherwise be sold to first-time low-income buyers, “says Evanagelou.

House prices continue to rise, but at a slower pace

“Due to housing shortages, home prices will not fall in 2022. Remember that home prices will not fall when they fall. In fact, home prices were around 2, but in May Home prices have risen by about 15%, a percentage point higher than they were a year ago, “says Evangelou.

Inventory is increasing

About 20,000 more homes are for sale for buyers who earn $ 200,000. “We look forward to more homes available on the market, but we need more entry-level homes,” says Evangelou.

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