Okay, we kinda got a bit of a double whammy here. What sort of whammy? Rates are at 20 year highs and home prices have risen dramatically over the past several months. Higher rates and higher home prices don’t really bode all that well for those looking to buy a home. So what can we expect?

The Fed ‘been busy’ having raised the Federal Funds rate to its highest in a couple of decades. This as a result of continuing inflation. The dollar doesn’t buy as much as it used to as the prices for everyday goods continue to climb. One of the most recent price indicators, however, shows that, while the rate of inflation is indeed lower, it’s still increasing. What we really need right now is a little reprieve.

The Fed recently sidestepped any rate increase at their last round of meetings but has also indicated it stands at the ready. Home prices, nationwide, seem to have plateaued a bit. What this could very well mean is that there won’t be any more rate hikes in the foreseeable future and home prices appear to have taken a breather.

One other important thing to remember however, going into Fall and Winter, that’s the slower time of the year for homesellers. Most homes are bought and sold in late Spring and Summer. There are more buyers during that period so sellers put their homes on the market. When families move, they like to move when school’s out. When there are more buyers, there will be more homes. Kind of a supply demand thing. 

When someone lists a home in the ‘non-buying’ season, they’re a bit more motivated to sell. For whatever reason. Sellers know they might be able to get a better price by waiting but sometimes that’s not an option. This can mean sellers might be open to a little more negotiation during the Fall/Winter period.

But don’t expect a precipitous home price devaluation. Won’t happen. All things being equal or course. A rapid price deceleration would mean it’s the result of exterior, third party influence. And much less so due to a panicked or distressed seller.

Finally, don’t expect rates to move down anytime soon, at least noticeably so. From this desk, it looks like the Fed will stand pat at least until the early part of next year. And remember, it takes a lot for mortgage rates to fall. So both time and patience will be needed. And when the rate does come down, it won’t be anything major, such as maybe a ¼% drop or so.

So what about that relief? It’s coming, just maybe not as fast as we all would like. Pay close attention to your real estate agent. During periods like these, this is no time to ‘fly solo.’