Indicators point to a continued market slowdown, optimism on the horizon
Here are my bullet points from the newest press release from the Northwest Multiple Listing Service (data is from the full month of September):
- “The real estate market typically slows down in the fall and winter months. However, the high-interest rate environment has further decreased the purchasing power of prospective buyers leading to a continued decline in year over year transaction volume with overall median prices stagnating.”
- When compared to the same month last year, September 2023 experienced a -20% change in active property listings on the market.
- Most counties covered by the NWMLS (23 of 26) saw a decrease in the number of homes sold.
- With mortgage rates at a 23-year high (7.31% for a 30-yr fixed rate mortgage as of 9/28/2023), Freddie Mac indicated more and more buyers and sellers say they are holding out for better circumstances.
- Early in 2023, economists predicted gradual declines throughout the year, but in fact rates have trended higher.
- It is unlikely mortgage rates would drop below 6% before the end of the year, “and most homeowners wouldn’t be motivated to sell unless rates dropped further.”
- A recent study found that 92% of homeowners with a mortgage have a rate below 6%, and nearly a quarter (24%) have a rate below 3%.
- “For buyers who are not in a hurry, the fall and winter months could bring better values and a less competitive environment to find the right home.”
- “Any meaningful decline in mortgage rates could lead to a rush of buyers later in the year and into next.”
To read the full press release, click here.