What happened to that cool down in the real estate marketplace?
As the spring selling season blooms, the housing market is experiencing a surge in demand, defying early-year predictions of a cooldown. With mortgage rates still up, the strong demand for homes can be primarily attributed to the exceptionally low supply of homes available for sale. This unprecedented demand bodes well for sellers, as more buyers are entering the market.
Spring has officially sprung, and the housing market is following suit. Despite a more subdued buyer presence compared to last year, new data reveals that a growing number of prospective homeowners are joining the market. This trend can be observed through mortgage purchase application data, a key indicator of buyer demand. As Investopedia explains, “A mortgage application is a document submitted to a lender when you apply for a mortgage to purchase real estate.” Therefore, an increase in mortgage applications signifies a corresponding rise in buyer demand.
Joel Kan, VP and Deputy Chief Economist at the Mortgage Bankers Association (MBA), explains that application activity increased as mortgage rates declined in March. This uptick, coupled with data from other sources, suggests that home sales are on the rise—a welcome development for sellers.
In fact, the relationship between mortgage rates and applications is quite evident. As rates spiked last year, applications dwindled in response. However, the recent drop in mortgage rates has led to a renewed surge in applications, signaling that more buyers are actively searching for homes.
The California Dream for All program, which only lasted 10 days, showed us there are many potential homebuyers out there that not only can afford a monthly mortgage payment but want to be homeowners. What’s stopping them? The downpayment needed to purchase a home is one of their largest hurdles. The program combatted that. As rates come down, watch even more buyers hit the market as affordability goes way up. Many want to buy a home right now, regardless of market conditions.
So, what does this mean for you? The spring season is traditionally the busiest time of the year for real estate. If you’re a seller, now is the perfect time to get ready. Realtor.com advises homeowners planning to sell in 2023 to start preparing their homes for the market. Partnering with a local real estate agent, or your local Sackin-Stone Team member (hint, hint) can help you maximize your home’s appeal and determine the ideal listing price for your area.
In conclusion, the housing market is heating up this spring, defying the anticipated cooldown. If you’re considering selling your house and want to take advantage of the recent upswing in buyer activity, team up with a local real estate agent to make the most of this exciting opportunity.
