Potential buyers are no longer getting sidelined by high mortgage rates and surging home prices.
But, according to Matt Vernon of Bank of American, home buyers are losing patience. They are moving forward from their goal of buying their dream houses.
“The dream of homeownership is alive and well,”
according to Vernon, the head of consumer lending at Bank of America.
As of October, almost a third of prospective homebuyers are moving and not waiting for the house prices to fall down. They aren’t also curious about the interest rate falling down, according to the Homebuyers Insight Report of Bank of America.
This finding comes while the housing market struggles to gain momentum. The Federal Reserve’s dominating rate hiking campaign boosted mortgage rates to a peak level of the last two decades last October.
Also, because of high rates, they sellers are still existing in their old homes instead of giving off the low monthly payments, creating a downfall in the inventory crunch. According to Bank of America, 80% of the current homeowners have a below-5% interest rate.
Pending home sales in the US fell by 8.5% last October. According to NAR, the Northeast is the only region to see monthly gains in its pending transactions. All of the four regions in the US have seen a decline in sales on a year-over-year basis.
“We are in a very unique housing cycle where homeowners are unwilling to list their property because they are locked in on those lovely 3%, 4% mortgage rates,”
Lawrence Yun, chief economist of NAR, told Yahoo Finance.
“They’re all smiling. Their monthly payments are low. Their housing wealth has risen greatly.”
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