I really think the key factors:
#1 – Price increases- The buying market can’t continue to absorb the large price increases without a push back.
#2 – Mortgage rate increase- double whammy. Someone who recently refinanced see a rate that is up 1-2% from their current rate, even though today’s rate is still a great rate historically, just can’t stomach it. Also, now increased price, increased rate, hurts buying power, therefore they are getting less house.
The issue this time around is not too many houses, the issue is inflationary pressures pushing prices and now the buying market is pushing back saying this does not make sense to us. We are going to see some slow down until the market can stomach the price increases, or the buyer just has to buy due to lifestyle needs.
I think we will have buyers waiting as they adjust to what may be the new normal in pricing. This is what really concerns me.
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