Rates, Recession & Rebound — The 3 Rs of the Houston Housing Market
Rising mortgage rates have tapped the brakes on the market
Inflation & fear of recession have caused a bit of a pause for buyers & sellers
Prices continue to rise, but at a modest rate & we should expect some decline
Homeowners with low interest rates are staying put so there are fewer homes available
More homes expected to come on the market for spring selling season
Sellers: Low inventory & pent up demand mean it’s a great time to sell
Buyers: Easing home prices continue to be good news for buyers not wanting to compete in multiple offer situations
Year-over-year home sales have fallen each month since April of 2022 as our market has come back down to earth from the unprecedented (and unsustainable) market of 2021 and the beginning of 2022. While the headlines have been negative, compared to pre-pandemic years, the Houston real estate market has actually held its own.
As mortgage rates have risen close to 6.75%, some homeowners with low interest rates have been staying put because they know they won’t get as good of a rate if they move. Higher interest rates have also driven many buyers from the market. In fact, the high rates have caused mortgage applications to drop to their lowest levels in 28 years, and half of those applications were from refinances.
As we enter the spring selling season, we do expect to see a shift in our market. This typically busy season should result in a significant increase in inventory and more buyers re-entering the market as well.