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But what a great time this is for reveling in the outdoors, and the backyard deck is such an enjoyable area of the house. This space also eases the transition between the indoors and the out and adds to the experience of outdoor living.
This May, aside from special community events and other features, it's all about the deck.
I feature insightful articles to create your ideal deckscape and other elements to perfect the art of outdoor living.
Now, let's review this month's most salient real estate market characteristics.
MARKET HIGHLIGHTS
So the big financial news this month is yesterday's announcement of the rate hike by the Federal Reserve to cool down overspending and curb inflation brought on by the post-Covid high demand/ low supply environment.
This becomes more relevant as continuing supply and demand impacts are expected to continue due to the invasion of Ukraine by Russia, and the current Covid lockdown in China.
How will these events affect the housing market?
Already in the week ending April 28, a 30-year fixed rate mortgage averaged 5.1% which is a lot higher than the period when they were in the low 2%, or even last November when they rose to 3%.
Some industry experts like Mortgage Broker Rocke Andrews of Lending Arizona predict that rates will "crack 6% this year" while Lawrence Yun, the Chief Economist at the National Association of Realtors says that "five-and-a-half percent is definitely within reach, but 6% is a bit of a stretch."
So less buyers will qualify and will place their home buying dreams on hold.
On the positive side:
- The market rose less than many were expecting
- In response, the Dow Jones rose 900 points -- its best day in 2 years!
- Though current rates are higher than the recent home mortgage rates we had grown accustomed to, this is nowhere near the all time high of 18.6% when in 1981, the country was also struggling with inflation
- A benefit for remaining buyers is that with other buyers being priced out of the market, there will be less competition or over the top bidding wars
Another consideration:
- According to Fortune Magazine, a few housing markets in Arizona, Massachusetts, Michigan, Connecticut and Washington State overvalued their homes but this is a very small percentage and no market in the state of Louisiana is included in this study
How will the rate hike impact the rising home prices that have been a driving market factor in the last 2 years?
- According to economic models by the Mortgage Bankers Association, Bank of America, Fannie Mae, and Zillow, these experts predict that home prices in other markets will continue to rise, albeit at a much slower rate [3.8% from December 2021 to December 2022]
What will drive the --albeit much more-- gradual increase in prices?
- Millennials
- Ever tightening inventory of homes [due to increases in prices and mortgage rates, even less buyers may sell]
MAY NEWS
Now that the weather is warm, we've selected a few nice outdoor music events for you to attend, plus the Annual Northshore Parade of Homes, the Annual Slidell Spring Crawl, and even a Yoga Fest. We've also included articles to inspire a renewal of your outdoor living spaces and in particular, your deck spaces or deckscapes [same spelling re-organized].
Yes, the market is challenging. Yes, mortgage rates have gone up. But we are selling homes and our clients are buying! We are here to help you with either transaction or both.
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