Homebuyers are Adapting to the Changing Norms of the Real Estate Market

Prior to making the decision to sell your house, it is crucial to be well-informed about the prevailing conditions in the housing market. One encouraging development at present is that homebuyers are embracing and adjusting to the current mortgage rates, considering them as the prevailing norm.

To gain a deeper insight into recent mortgage rate trends, the graph below illustrates the trajectory of the 30-year fixed mortgage rate from Freddie Mac since last October. As depicted, the rates have shown remarkable consistency, remaining within the range of 6% to 7% over the past nine months.

Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), emphasizes the crucial role that mortgage rates play in influencing buyer demand and, consequently, home sales. Yun underscores the favorable effects of stable rates on the market.

"Mortgage rates wield considerable influence over the trajectory of home sales. The presence of relatively stable rates has resulted in a series of consecutive months with steady and consistent home sales."

As a seller, receiving news of current consistent home sales is indeed promising. It indicates that there is an active presence of buyers in the market actively purchasing homes. For a better understanding of how mortgage rates have influenced this demand recently, here's some additional context.

After the substantial surge in mortgage rates last year, which escalated from around 3% to 7%, many potential buyers were taken aback and decided to postpone their plans to purchase a home. However, as the initial shock wore off, buyers became more accustomed to the current mortgage rates and accepted that the record-low rates of the past few years are now a thing of the past. As Doug Duncan, SVP, and Chief Economist at Fannie Mae, explains:“. . . consumers are adapting to the idea that higher mortgage rates will likely stick around for the foreseeable future.”

Indeed, a recent survey conducted by Freddie Mac indicates that 18% of respondents express a strong likelihood of buying a home within the next six months. This implies that nearly one out of every five individuals surveyed has plans to make a purchase in the near future, demonstrating a proactive approach among buyers in the upcoming months.

Undoubtedly, mortgage rates are not the sole determinant influencing buyer demand. Regardless of the prevailing mortgage rates, individuals will consistently have reasons to relocate, be it for job-related moves, changing family circumstances, or other personal motivations. As a seller, you can be assured that there is a market for your house in the present climate, and the demand remains quite robust as buyers adjust to the current rate environment.

Bottom Line

Buyers' perception of today's mortgage rates is evolving, as they adapt to the new normal. The stability in rates is bolstering strong buyer demand, leading to consistent home sales. If you're looking to sell your house, consider reaching out to a local real estate agent who can help you get your property on the market and attract these motivated buyers.