Although the real estate market has been a driver of economic growth in recent years, homebuyers are feeling increasingly locked out. High prices and rising mortgage interest rates have made geting into the market difficult.
For many potential homebuyers, rising prices and interest rates have meant that the costs of homeownership outweigh the benefit of owning a home. According to a survey by Zillow, one-third of potential homebuyers have had to change their plans and are now delaying their home purchase to save for a larger down payment and higher monthly payments.
At the same time, the inventory of homes for sale has not kept pace with the number of buyers, further compounding the issue. With competition for homes fierce, buyers often find themselves bidding against others to secure the best properties.
Furthermore, home builders have not been able to keep up with demand, which makes it even more difficult for buyers to find homes at a price they can afford. As a result, there is a shortage of new construction homes on the market.
The combination of rising prices and mortgage interest rates, limited inventory, and lack of new homes on the market has put a squeeze on potential buyers and has made it increasingly hard for them to get into the housing market.
For those potential buyers that are able to make it into the market, they will face higher monthly mortgage payments. Those extra costs can put a strain on already-stretched budgets and may mean having to cut spending on other items.
With the state of the housing market as it is today, it is more important than ever for potential homebuyers to do their research and be prepared before they embark on their journey to homeownership. Being savvy and knowing what to look for and how to negotiate can help buyers get the best deal and make the best of the current situation.