Higher interest rates are becoming accepted? (loan, buy homes, rate, refinance)

[NORTY FLATZ]

Many prospective buyers have been "shell shocked" by the doubling/tripling of loan interest rates. Now that

it has been a full year of elevated money rates, it seems like it has finally settled in, that money isn't going to

be "dirt cheap" like it was 16 months ago. This has caused prospective buyers to start shopping in earnest.

These were the same people that stayed on the sidelines, thinking the pricing would soften, due to

affordability. Well, this hasn't happened, YET. It may never happen, either.

So, what happened? I think we have a phycological exercise going on here. Similar to the 5 stages of grief.

1. Denial. "This will turn around."

2. Anger. "Dammit, I can't buy what I want, for the price I think it's worth!"

3. Bargaining. "If I do this, maybe the seller will do that."

4. Depression. "Damn, I can't get a damn thing, as I'm outbid at every turn!"

5. Acceptance. "Well crap, this looks like this is going to be this way, for the foreseeable future, so I might as well jump in, and do my best"

Well, I'm seeing some buyers at "Step #5" now.

They have accepted that money isn't going to be "cheap" again, for a few years, at least. So, those that

have been waiting for a price correction, are still waiting, on the sidelines.

Many say, that the demand/supply imbalance is the causation of the strong pricing. It may be. But I'm of

the opinion that we simply have too much demand, and that our supply could be "ok" if it weren't for so

much foreign investment. This is killing the chances for our next pool of owners, that already LIVE here.

They're in competition for a finite number of properties.

Anyone get what I'm trying to portray?

What's happening, in your neck-of-the-woods?

[Hemlock140]

We still have very little inventory, but unlike 6 months ago, those homes that are for sale are going just as fast as back when interest rates were low. Our city has nothing below about $1.3 million in a single family home, and apparently people either have the cash or don't mind the high interest. Some of the seniors that are ready to downsize are staying until rates fall, because they don't want to be stuck with a high payment on less income. Some, like us have enough equity to pay cash when downsizing but are still waiting because if rates do fall, we will go back to the bidding wars and crazy prices.

[ejisme]

They are still buying fast in my area. Neighbor on my block put the sign up on Wednesday. I talked to him Saturday and he had three offers already and was expecting more. Seems most houses that are 'reasonably' priced have the sale pending sign added in about a week. During the low interest rate period most houses were sold before the sign went up.

[StealthRabbit]

Idaho (and other desirable destinations) are booming.
Cash sales are booming.

Expensive metros are declining ~10%< so no 'crash', since they are 30% overvalued.

A new reality, but nice places are few, so they'll remain in demand.

If the price is right, it will sell.
If the price is right, you should buy.

[SmartMoney]

It's like anything else, the consumer needs to come to grips with it, search for a way to make it happen (maybe I will have to rent the basement for a year or two, or maybe I will have to postpone the new car, make up the difference with my 401 and so on).

It's pretty much the same as it has been, only with more disappointment. It's a process. International buyers are buying like there's no tomorrow.

[NORTY FLATZ]

Anyone here think that Jerome will lower the interest rate, during 2023?

LOL, me neither!

[NORTY FLATZ]

Ok, how about 2024?

Yup, me neither! (Too!)

[gatorlyn]

We are on the market to upgrade on a larger home, but have to go the mortgage route and have been watching rates closely.

By the time we get some type of relief (5% or below) on interest rates, we probably would have already inherited my parents’ and my in-laws’ homes, they are up there in age.

[DannyHobkins]

Here's the deal. Everyone is on the sidelines waiting for interest rates to drop. When/if they do, you are going to have a rush for people to buy homes that there will be even more bidding wars. Just buy now, and if interest rates ever drop, you can refinance.

[prospectheightsresident]

People are definitely still buying around these parts. I'm locked into a 2.75% mortgage rate so have no intentions to sell anytime soon. When we finally do move back to the mainland, hopefully rates will have come back down somewhat. If not, we'll probably still buy.