The real estate market, like the weather, goes through seasons. We are now facing the fall season, where supply and demand drop and will reach their lowest point during winter. And then again, next year, after the Superbowl, we will see it get warmer again.
On the other hand, many potential buyers have decided to wait to purchase a home until next year to see what happens with interest rates. We have heard from many of them that they will wait until “after the first quarter of 2023 when interest rates drop again”.
We are not sure that interest rates will drop in the first quarter of next year or in the next year at all, but if they do, be aware that not only will we see the market in general pick up again, but thousands of frustrated buyers that have been waiting for months to get into the market.
So let me tell you the advantages of today’s market with an example. I am in an escrow that is closing early next week, representing the buyers. The property had just come onto the market a day before we went to see it. They fell in love, and we immediately placed an offer. In today’s market, a property takes, on average, 60 days to sell, so the sellers were excited to get an offer so quickly. This timeframe allowed us to ask the seller for a credit of 3% of the purchase price. With this credit, the buyers were able to buy down the interest rate of the loan for the first three years with a 3-2-1 buydown. This product has a reduced rate that in year 1 is three percent below the current rate; in this case, year one is at 4%. Then year two is at 5%, year three is at 6%, and year four to thirty is at 7%. The advantage is that my clients can refinance the loan as often as they want. So they can refinance in 6 months if rates do go down by then.
The saying goes, the best time to plant a tree was 20 years ago. The second best time is now. If being a homeowner has been a dream of yours, stop waiting. I would love to answer any questions you may have about this subject of the market in general. Please respond to this email. I would be happy to help you make your real estate dreams come true.
