Now is undoubtedly the worst time to buy a home in America. Mortgage rates increased dramatically over the past year. So much so that it is close to 7% for a 30-year fixed rate loan. Over 4 per cent units were marked above what was recorded in the previous year.
Data like the above has reduced the purchasing power of buyers by a whopping 14%, for obvious reasons. This was revealed by Black Knight, a leading mortgage statistics company.
Faced with such a real estate panorama, potential buyers give up or even think about buying a home. It is a chain reaction that also affects the indicators of home sales.
A survey by Fannie Mae highlighted that only 16% of those surveyed believe it is a good time to buy a home. The chilling data on this topic represents a record low level in the United States.
With the pandemic came record prices
During the pandemic phase, house prices skyrocketed to unprecedented levels, even setting records for the country. These have come down a bit now, though they are still not as affordable as buyers would like.
Meanwhile, another key parameter slows down real estate sales. For example, the low inventory of homes available for sale is a current drag faced by real estate companies and agents, among others.
Jackie Lafferty, a member of Baird & Warner Real Estate in Chicago, referred to the subject: “It’s a combination I’ve never seen before.” “There is no offer and interest rates are high. So, there is no motivation for people to move unless they have to,” said the expert.