We talk about mortgage rates quite a bit here, and there’s a good reason – the current mortgage rate provides a great indicator of how many potential buyers will be in the market. Given that inventory is low, more buyers means higher sales prices for our sellers.
It seems every month or so mortgage rates hit a new “all time” low; today is no different. The two-pronged attack of COVID and the associated economic downturn have resulted in mortgage rates that are continuously decreasing; lower mortgage rates have the immediate effect of lowering your monthly mortgage payments, and a long-term effect of reducing the total cost of your home. As such, the mortgage rate dropped to 2.86% on September 10, 2020 (the previous “record low” was 2.88% on August 6, 2020; it was 3.56% on September 12, 2019). Most experts believe the mortgage rates are close to the lowest they could possibly get absent a significant downturn in the economic recovery the United States is experiencing. However, the same experts believe the rates won’t go above 3.5% until the 4th quarter of 2022.
These low mortgage rates have generated a lot of business in the real estate market, and the low inventory has driven prices up. The median home price has risen by 10.8% since September 5, 2019, hitting $350k nationally.
Given that mortgage rates are down, and will stay down for the foreseeable future, the only unknown is whether inventory will increase. As long as inventory is low, sellers should expect to see the value of their homes increase (there is a cap on this projection, but it doesn’t seem we are there yet). As such, we expect a strong seller’s market for quite some time.
At the Chernov Team we understand that knowledge is power, and knowledge of how the market is behaving is powerful knowledge indeed. At the Chernov Team we know that whoever comes to the table most prepared leaves with the most, and the Chernov Team always leaves the table with the most