馃摙 MARKET UPDATE - JUNE 2022 馃毃

Seattle, Washington
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馃摙 MARKET UPDATE - JUNE 2022 馃毃

Aaron Morrow
Real Estate Agent 路 Seattle, WA 路 Member since 2020 路 62 posts 路 42 votes

With the the mortgage rate inching closer to 6%, there has been a decline in existing-home sales. 

While affordability continues to take a hit, there are still interested buyers looking to secure a home.

Source: REALTOR庐 Magazine, "Mortgage Rates Rise Modestly to 5.81%"

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  • Jeremy Horton
    Rental Property Investor 路 Somewhere over the Rainbow 路 Member since 2021 路 1k+ posts 路 1k+ votes
    4y

    So there's always buyers looking to secure a home - 10 years ago, today, and 10 years in the future. 

    Thing is...what drove the demand (and prices) up? Low interest rates, influx of money (inflation), remote work, supply chain problems...

    What happens when demand falls? Interest rates return to "normal" (much higher than they have relatively been the past 2 years), economy goes into a recession to prevent inflation from going out of control, remote work (may stay some, some may get laid off), supply chain problems normalize a bit 

    Here's the thing - demand in the market can change rapidly (we've seen this in the past 2 years) due to interest rates and 10 trillion $$ created. Yes we still have a "low" supply, but the supply side moves much slower than the demand side which is why we have the imbalance today from my understanding. We've had a "low" supply for awhile but we've not had an issue cause demand was balanced with supply. The manipulation of the creation of money and low interest rates to prevent a recession during covid created a rapid increase in demand. 

    Demand has to slow imo, and it will slow fast, much faster than supply can change. I think we're just getting started and we're going to see more price decreases in the next 18 months in the housing market and more of a return to "normal"

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