Surging mortgage rates, home prices are making it less competitive to buy a home
Homebuyer competition fell in March for the first time in six months as mortgage rates and home prices surged, a new Refin report found.
Last month, 65% of homes faced competition, down from February’s 67%, the first month-over-month decline since September. Redfin analysts said this is a sign demand is cooling as rising mortgage rates and home prices are prompting buyers to back out of the market.
And that drop in competition is a sign the housing market is starting to slow down. Redfin also found mortgage applications, home tours and online housing searches fell, and that more sellers are lowering their asking prices once homes are on the market.
Despite the cooldown, bidding wars are still more common than they were last year. March’s bidding-war rate was 69.3% down from February’s 71.9% but up from 62.2% in 2021.
Redfin chief economist Daryl Fairweather said while most homebuyers are still encountering bidding wars, competition is starting to cool.
“We expect bidding wars to ease further in the coming months as rising mortgage rates price more buyers out of the market,” he said. “That should provide some relief for people who can still afford to buy, as they’ll likely face fewer competing offers and may no longer need to offer drastically over the asking price in order to win. Unfortunately, the slowdown in competition won’t help those who have already been priced out of homeownership and are now grappling with soaring rental costs.”
Today’s average 30-year fixed mortgage is at 5.11%, the highest since 2010, up from a record low of 2.65% in January 2021. Home prices are up 17% from last year to a record $392,750, according to the report, increasing the typical mortgage payment up by more than 30%.
Boston has the second most competitive housing market, with a bidding-war rate of 79%, followed by Providence, R.I., at 78.3%, Worcester, Massachusetts, at 78.2% and San Diego, California, at 78.1%. San Jose took the No. 1 spot at 79.8%.
The report also found townhouses to most likely to see bidding wars, 72.4% of offers had competition in March, higher than any other property type. They were followed by single-family homes at 70.2%, multi-family properties at 68.1% and condos/co-ops at 62.6%.
The reason for the increased townhouse competition stems from homebuyers who’ve been priced out of the single-family home market.
While spring is the traditional homebuying season, it doesn’t mean you can’t have success selling Boston real estate in late Summer early Fall—it just requires a different approach. Around fall, the market tends to pick up and become and Boston real estate for sale inventory is on the rise. Fortunately, Boston’s Fall market weather keeps the market for real estate in downtown Boston from slowing down too much, although you should keep in mind the weather in Boston can change very quickly. Here’s what you should know to get your Boston condo for sale sold during the fall so it doesn’t linger on the market into the cold snowy winter months
When it’s a buyer’s or even a seller’s market, you need to make sure your Midtown condo is priced to sell, especially during the fall when there will be more competition of Boston condos for sale for buyers to view. While the Fall months are indeed one of the peak selling season, the right pricing strategy can help you sell your Seaport condo for sale in any market. Your downtown Boston real estate agent will help you develop a competitive pricing strategy that avoids one of the biggest mistakes you can make: overpricing, which will get your home ignored in a buyer’s market and leave you chasing after buyers with price reductions later.
It goes without saying that you’ll want your Beacon Hill condo to be in the best possible condition to appeal to as many buyers as possible. Think of your home not as your home but as an asset you’re trying to sell for as much money as possible. Your Beacon Hill home should be in showroom condition because the last thing you want potential buyers to see is a home full of unfinished projects or outdated fixtures. After all, they’ll have plenty of other options during the fall. Three important steps to take include:
- Declutter – Keep it simple, clean, and subtle as you go through each room, removing unnecessary furniture, personal items, and knickknacks. When buyers walk into your home, they should be able to picture living there and how their belongings will look, not how small the room feels with too much furniture.
- Stage – Simple forms of staging can really make a difference. Make sure to have fresh white towels and throw rugs when prospective buyers come to visit. When staging your home, remember less is more.
- Repaint – A fresh coat of paint can go a long way toward making your home feel fresh and new. It’ll make the house look vibrant and clean, and it’s a chance to switch out personal color choices for neutral hues that will appeal to others.
Any marketing is good marketing, and in today’s online world, there are many outlets and opportunities to get your Boston North End condo for sale in front of prospective buyers. Especially during the fall, it’s important to use a variety of marketing strategies, such as video tours, open houses, social media posts with pictures, emails, and flyers. Make sure you choose a downtown Boston real estate agent who has aggressive and effective strategies to sell your home.
While most buyers want to move during the summer so their kids will be able to start school on time and spend the holidays in their new homes, there will still be plenty of buyers ready to buy in the fall. Try to identify the buyers most likely to be interested in your property, whether they’re retirees, singles, young couples, or buyers looking for second homes. Selling your home can be a stressful experience at any time of year, so it’s a good idea to hire an agent to take care of all the details for you. If you have a loft, penthouse, or any type of Boston real estate for sale, reach out to the professionals at Ford Realty Inc., to guide you through the process. Call one of our friendly agents today at 617-595-3712 and set up an appointment to discuss how we can help.