The jumbo rate above is 6.1% at no points, which means you can get into the mid-to-high 5s with the Boston condo buyers – or sellers – paying a point or two.
With the discounts already in place in some areas, and last week’s drop in the mortgage rates, this might be the best combination of discounts/declines that we will see in the next 1-2 years.
The Fed is going to keep raising their fed funds rate. Powell, Bullard and others have said that the FFR needs to be at least 1% higher, and they intend to get there next year. They don’t determine the mortgage rates, but you can imagine the impact on the bond/MBS markets.
What they won’t consider is where potential home sellers are going to draw the line.
Today, we might find sellers who are willing to consider a price that is 5% below peak, with an occasional 10% or 15% off. But you can bet that when it comes to selling for 20% to 30% below peak prices, most Boston condo sellers will become highly resistant.
How many will quit instead? Or not even bother with trying to sell? My thoughts plenty.
I think the higher rates go, the lower the inventory will be.
The difficulty of finding the right Boston condo for sale, at the right price, will keep getting harder and harder.
Boston condos for sale and the bottom line
If you can find something close to the perfect home today, consider it strongly!