How will the end of forbearance and rising rates impact the market?
The mortgage forbearance program has officially ended and interest rates are on the rise. Both could signal a rougher road ahead for home sales. According to Realtor.com, foreclosures are increasing, but at a lower rate than pre-pandemic. The good news is that most experts don't see another 2007/2008 crisis in the cards. With inventories remaining light sellers will still benefit, however, buyer's purchasing power will be diminished with every uptick in mortgage rates. At some point either increasing rates and/or a rise in inventory levels will impact sale price, the question is when and how much? The sales chart below shows home price growth is still robust, but many are expecting slower growth over the next year. If demand weakens buyers will have a good opportunity to purchase a home. Hope you all have a fun and safe Halloween!
Single family home prices(median) for June 2021-August 2021:
*Please note that this area had few sales so percentages are somewhat misleading
Weekly national mortgage rates for loans under $400,000, top credit scores: