Wednesday’s rate hike, the fourth enacted to combat inflation, continues to hit the housing market, even in North Texas.
A DFW broker said buyers are being more cautious for fear that they may not have enough money to buy.
The 30-year average mortgage rate has passed 7% for the first time in two decades, according to mortgage giant Freddie Mac.
Michele Wood and her husband are willing to retire to Arkansas if they can sell their home in Denton.
“I would have wished we had done this in August because our house could have been sold by then,” Wood said.
Their three-bedroom, two-bathroom home on White Dove Lane has been on the market for 27 days.
There have been a number of interested buyers, including two competing cash offers that have been requested, but no transactions have yet been made.
“Yes, that surprised me a bit, but there was the right buyer,” said broker Joanne Condi, of Remax DFW Associates in Frisco.
Condi said the red-hot housing market in North Texas is cooling off after a strong summer with low interest rates and competition driving prices up.
“In places like Coppell, if I held an open house there, I would have 30 couples lined up,” Condi said.
These days, only a handful of potential buyers come to buy and sell.
Sellers and buyers now face rising interest rates, fewer displays and larger inventories.
“I think we need to get used to the 7-8% rate,” Condi said.
Condi said inventory in and around Denton is currently holding at two months, but does not predict North Texas will experience a six-month inventory run, which would signal a balanced housing sign for both people. seller and buyer.
House prices are falling.
“Krum, which is just north of here, has started to drop in price,” she said. “Frisco has also continued to lower their prices.”
Some sellers are also turning to concessions again.
Wood is willing to offer their buyer $3,000 that can take into account closing costs, or if the buyer chooses to sign up for a ‘point-back’ to help lower their interest rates.
“It’s a bit expensive,” Condi said. Sometimes it can be $1,000 – $2,000 depending on the buyer’s credit score and how much they spent.” “There are some lenders out there that are even doing a two-point buyback and can get it down to 5%. So in the first year, you can have it at 5.5%, the second year. of your mortgage, it could be 6.5% and then the third year would go back to the level your mortgage was locked in.”
Condi advises sellers to seek out an experienced real estate agent first.
“Don’t go for a $50-60,000 improvement before you even call the broker because you may not get all that money back,” she says.
Pack your patience but be ready, Wood urged.
“Always get your home ready when someone says, ‘I want to come in,'” says Wood. “Absolutely! Come now. I’m ready for you.”