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Prices of Homes Fall While Rates Heat Up | The Neighborhood Minute July 2023

07/06/2023 - Neighborhood Minute

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The WesBanco Neighborhood Minute

The Neighborhood Minute: Prices of Homes Fall While Rates Heat Up

July 3, 2023

The Summer Housing Market Has Yet to Heat Up

Blame it on the current housing market and economic uncertainty, but buyers and sellers remain in a stalemate as we head into the summer homebuying season. As the housing market attempts to rebound, experts are seeing high, fluctuating interest rates, a dip in sale prices, and competition varying by region.

We encourage those entering the market this year to remain flexible and stay up to date with the market in your region and the current trends.

The Latest Housing Market Trend Report

Small Gains in a Stubborn Housing Market

  • If you’re looking for a previously owned home, the average existing-home sale price continued to fall for the second consecutive month.
  • Home sales are also taking a dip month to month and are down 22% from a year ago.
  • Overall, the Fed’s rate hikes, ongoing inflation and weakening economic growth are contributing to a slow housing market recovery.

Federal Housing Market Rules and Legislation to Watch

  • Home buyers will need to navigate the new mortgage fee rules imposed by the Federal Housing Finance Agency (FHFA) that began May 1.
  • The new, loan-level price adjustment dictates that conventional mortgage borrowers who put between 5% and 25% down will pay more in fees than those who put down less than 5%.
  • The bipartisan House bill “More Homes on the Market Act”, was introduced earlier this year and would amend the tax code to incentivize more homeowners to sell their houses, increasing the housing supply.
  • The revised bill has picked up more traction as housing affordability and supply become a focus for federal and state lawmakers.

 

2¢ Worth of Wisdom

Q: Is a 15-year mortgage right for me?
A: “Current 15-year mortgage rates are ticking lower than their popular 30-year counterparts, which is something to consider. But the answer lies in your homebuying budget. With a 15-year fixed-rate mortgage, you could secure that lower rate and build up equity faster, but you’ll need to adjust your budget for a higher monthly payment overall. It’s a great option for paying off a home faster, while saving on interest if it fits in your budget.”

—Ed Hensley, Executive Vice President and Manager, Residential Lending

 

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*All information cited can be found on housingwire.com.

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