The nation’s housing market has never been this tight, which is frustrating enough for house hunters, but now they have another problem.
Mortgage rates, which have hovered around record lows since the start of the Covid pandemic, are now rising. It’s what one potential buyer called “a perfect storm.” Another described it as “agony.”
At a Sunday open house in Waldorf, Maryland, last weekend, there were already three offers on the three-bedroom home before it even started. By Tuesday, the agent’s deadline, there were nine.
“We’re stuck between a rock and a hard place,” said Rondie Robinson, who was there with his wife and daughter. Robinson said he recently got a new job and is looking to upgrade to a larger home.
“We thought that because of the winter months that it would slack off a little bit, prices would start to come back down to normal, but that’s not happening,” he said. “It’s anguish, it’s pain, it’s agony.”
Limited supply is taking a toll on sales. Pending home sales, which represent signed contracts on existing homes, fell more than expected from November to December, down 3.8%, according to the National Association of Realtors. The Realtors blame the drop on the extreme shortage of homes for sale, not on lack of demand.
New listings from sellers were down 8% year over year for the week ended Jan. 22, according to Realtor.com. Those listings have been below historical levels for eight of the last 10 weeks. As a result, active inventory, which is the total number of homes for sale, was down 28% from a year ago.