Federal interest rate hikes impact housing market
Home sales are already down 6.5% since March, according to Northwest Ohio realtor Eddie Campos.
TOLEDO, Ohio – If you’ve been trying to find a home, you know the U.S. real estate market has been hot for just over a year, with demand outstripping available homes and some buyers having to pay far more than the asking price just to give a competitive offer.
“Right now what we’re seeing is that some buyers have decided to take a little break due to the frustration they’ve had with their buying experience in 2021,” estate agent Eddie said. Fields.
According to RE/MAX data, the entire northwest region of Ohio – from Toledo to Lima – has only about 780 homes for sale in total; a product of this rabid demand. However, this demand is decreasing.
Campos says that with recent interest rate hikes from the Fed looking to target inflation, home sales are already down 7% in Lucas County and the market this summer is expected to start looking a little different.
“Last year we were seeing houses that would have between 20 and 30 showings on the first day, I think what we’re seeing so far this year is that we always have a good opening day for our houses, so we’re seeing 10 to 15, which is probably more realistic for a house in great condition,” Campos said.
Campos says rising interest rates and low inventories could keep some buyers out of the market.
He says if you are looking for a ready-to-move-in home, there will always be a high demand for such a property. But he says if you don’t mind putting on a coat of paint or stripping wallpaper, those changes could mean it’s time for you to pull the trigger.
“These people will probably still be able to buy a house at list price, maybe a little cheaper, and still have a nice house,” he said.
However, Campos warns that these changes could also affect people’s pre-approval when trying to buy a home.
“Now that the interest rates have changed, they would be considered not pre-approved, they just may not be pre-approved for the same amount,” he said. “So going back to what I said earlier, instead of being pre-approved for a $200,000 home, it can be $150 or $175-[thousand] now.”