What level do mortgage rates need to get to for the market to loosen?
It’s no secret that the housing market has seen tight inventory levels for over a year. The housing market tightness is driven in part by homeowners who are locked into mortgages with rates far below the current levels. So, where do mortgage rates need to go to get current homeowners back into the market?
According to a recent housing market survey, homeowners are nearly twice as likely to sell if their mortgage rate is 5% or higher. 38% of Homeowners surveyed with rates above 5% said they’re planning on selling their homes. While only 21% of homeowners surveyed that had existing mortgages with rates below 5% considered themselves ‘likely’ to sell.
While it sounds like the housing market will stay tight until rates inch closer to the 5% mark, there was some good news in the survey. Nearly 25% of homeowners surveyed are considering selling their home in the next three years. That mark is up from 15% a year ago.
Where are home sales picking up in the North Carolina Triangle?
Single-family homes have been hard to come by in the popular Raleigh-Durham-Chapel Hill metro area in North Carolina. However, one sector of the local housing market has gained in popularity in recent months.
Luxury condos and townhomes in the Research Triangle area have seen an increase in sales. Comparing June 2022 to June 2023, condos and townhomes priced over $470,000 have seen a 14.3% increase in sales. Condos can be an ideal solution for a younger first-time buyer or an older buyer with an ‘empty nest’ looking to downsize.
The median price of a single-family home in the Triangle was $429,000 in May 2023, but condos in the area only had a median price of $275,000. It’s possible to find affordable housing in popular markets, but it may not be in the shape of a house.
Houston suburbs to get a boost in housing inventory
A new development and expansion of other housing projects could add 1,200 units to the greater Houston area.
Approved by the city council in Conroe, TX, 54 additional lots were zoned for new housing, and an additional 19 acres was annexed for development. The lots in Conroe will measure 52 ft. by 100 ft. and the homes will be priced in the $450,000 to $500,000 range.
These housing projects aim to bring additional units into one of the fastest growing areas in the country and enable families to achieve the dream of home ownership.
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