The headlines for September have been mortgage rates - after a startling hike over the summer followed by a slight decline, rates rose again mid-September. 

It was the highest reading for mortgage rates since 2008, and further evidence of the end of the decade-long period of low rates that followed the Great Recession. The Federal Reserve has been moving aggressively to control inflation, and its third consecutive rate hike of three-quarters of a percentage point last week would seem to create upward longer-term pressure on mortgage rates.

Sourced from Bankrate.com

“Only when inflation calms down will we see mortgage rates begin to steady,” said Lawrence Yun, chief economist for the National Association of Realtors.

Inflation, higher interest rates, and fears of a potential recession have taken a toll on buyers and sellers this summer, leading many people to stay on the sidelines to see what will happen with the market. But some experts, including Lawrence Yun, believe the worst of inflation may be over. 

What does this mean for buyers? If you are actively searching for a home right now, we recommend consulting with your lender to assess your current buying power. If you were previously shopping for a home at the top of your price range, your buying power may have been affected.  Keep in mind, economists are expecting further rate increases in the future. We may have a few months to catch our breath and recalibrate, but we don’t suggest pumping the brakes now. Buyers that are deliberate and creative will still have the upper hand in today’s market.

We are still very much in a seller’s market, however it is not the frenzy from previous months. Homes are still moving quickly, especially in move-in ready condition, with median days on market remaining unchanged across most of Vermont.  Although sale prices remain up from this time last year, price growth is expected to moderate in the months ahead as the market continues to shift in a more buyer-friendly direction.

Have questions about what this means for you or your home?

Contact us today.