New Homes Outperform

The housing market is a complex beast, and it can be difficult to predict what will happen next. However, there are a few trends that are worth noting.

One trend is that new home builders are not lowering their prices much, even though mortgage rates have been rising. Instead, they are offering mortgage rate buydowns to buyers – worth up to $50,000. A buydown is a type of incentive that allows buyers to get a lower interest rate on their mortgage for a certain period of time in exchange for upfront payment of interest, in this case, by the builder. This can make their monthly payments more affordable.

Another trend is that new homes are outperforming resale homes. This means that new homes are selling more quickly and for higher prices than resale homes. This is likely due to the interest-rate buydowns and the fact that new homes are typically more energy-efficient, don’t need repairs or remodels, and have more modern amenities than resale homes.

Finally, it is worth noting that prices stopped accelerating almost as soon as rates began to jump. This suggests that the housing market may be starting to cool off.

However, it is too early to say for sure what the long-term impact of rising rates will be on the housing market. We will need to wait for several months to see how the market reacts.

What’s the takeaway for the housing market?

Today’s report doesn’t tell us much about the future of the housing market. Prices in the $650-$750k range are largely stable. Additionally, the outlook may be rapidly changing depending on whether the highest interest rates are behind us. That’s a possibility that will receive more clarity with next week’s economic data, but it will take several months to confirm.

Overall, the housing market is still a bit uncertain. The trends we are seeing suggest that the market may be starting to cool off. We will need to wait and see how the market reacts to rising rates in the months to come.

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Margaret Hassani is an independent broker/realtor with over two decades of expertise in Tampa’s real estate scene. Known for her client-focused approach, she forms enduring connections.  Her a loyal clientele makes her the go-to realtor when selling.