SEATTLE – Baby boomers planning to downsize in retirement face a dilemma: Should they sell now while home prices are high since rising mortgage rates could push a drop in those prices – or should they hold onto their current home that’s too large because their current interest rates is somewhere in the 3% range?
Life goes on regardless of any current real estate market, and the decision covers more issues than just the financial value of a home.
“A lot of Americans are sitting on piles of money in their homes, and some are opting to cash out even if it means giving up their low mortgage rate; they’re worried there’s a possibility home prices will fall if rates remain elevated,” says Redfin Chief Economist Daryl Fairweather, who expects current mortgage-rate levels to hang around for a while.
“But we also expect prices to stay high into next year,” Fairweather adds. “Housing supply is so strained that even a small uptick in listings lures buyers off the sidelines, bolstering sales.”
According to Redfin’s latest report, pending sales ticked up but closed sales ticked down because about 16.3% of pending sales failed to close after buyers backed out.
“Buyers are extra cautious right now. They want to make sure they’re getting a good deal given how much mortgage payments have gone up, and when they don’t feel like they’re getting a good deal, they’re backing out,” says Heather Kruayai, a Redfin Premier Agent in Jacksonville.
“Transactions are also falling apart due to skyrocketing insurance premiums and disagreements between buyers and sellers over necessary repairs. Overall, buyers hold a lot of the cards right now, and sellers are having to give out more concessions to close the deal.”
When you are ready to buy or sell any real estate, please call us at 352-686-0000.
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