Homebuyers Are Getting Used to the New Normal

<article class="post-745531 post type-post status-publish format-standard has-post-thumbnail hentry" id="post-745531"><span class="entry-date">July 18, 2023</span><div class="entry-header center-block text-center"><h1 class="entry-title">Homebuyers Are Getting Used to the New Normal</h1><div class="shareBlock"><div class="shareTitle">Share</div><div class="shareIcons"><a aria-label="Twitter Share Link" class="twitter solid display-inline-block" data-tracking="Post,Social Post Link Clicked,Twitter" href="http://twitter.com/share?text=Homebuyers+Are+Getting+Used+to+the+New+Normal&amp;url=https%3A%2F%2Fgilliggroup.com%2Fblog%2Fhomebuyers-are-getting-used-to-the-new-normal%2F" target="_blank"><span class="force-hidden">Twitter</span></a>
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</div></div><div class="post-tax post-category"><span></span><a href="../category/realtor-blog/index.html" rel="tag">Realtor Blog</a></div><div class="post-tax post-post_tag"></div></div><div class="entry-content"><div><img alt="Homebuyers Are Getting Used to the New Normal Simplifying The Market" decoding="async" loading="lazy" src="https://media.agentaprd.com/sites/222/20230718-Homebuyers-are-getting-used-to-the-new-normal.webp" style="display: block; margin-bottom: 5px; clear: both; max-width: 100%;" width="358"/>
<p><span style="background-color: white; color: black;">Before you decide to </span><a href="https://www.simplifyingthemarket.com/2023/07/12/renting-or-selling-your-house-whats-the-best-move/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" style="background-color: white;" target="_blank">sell your house</a><span style="background-color: white; color: black;">, it’s important to know what you can expect in the current </span><a href="https://www.simplifyingthemarket.com/2023/07/06/todays-housing-inventory-is-a-sweet-spot-for-sellers/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" style="background-color: white;" target="_blank">housing market</a><span style="background-color: white; color: black;">. One positive trend right now is homebuyers are adapting to today’s mortgage rates and getting used to them as the new normal.</span></p>
<p><span style="background-color: white; color: black;">To better understand what’s been happening with mortgage rates lately, the graph below shows the trend for the 30-year fixed mortgage rate from </span><a href="https://www.freddiemac.com/pmms/archive" rel="noopener noreferrer" style="background-color: white;" target="_blank"><em>Freddie Mac</em></a><span style="background-color: white; color: black;"> since last October. As you can see, </span><a href="http://www.freddiemac.com/pmms/" rel="noopener noreferrer" style="background-color: white;" target="_blank">rates</a><span style="background-color: white; color: black;"> have been between 6% and 7% pretty consistently for the past nine months:</span></p>
<p><a href="https://www.simplifyingthemarket.com/content/images/20230717/20230718-The-New-Normal-Mortgage-Rates-Near-6-or-7.png?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/images/20230717/20230718-The-New-Normal-Mortgage-Rates-Near-6-or-7.png"/></a></p>
<p><a href="https://www.nar.realtor/newsroom/existing-home-sales-edged-higher-by-0-2-in-may" rel="noopener noreferrer" target="_blank">According</a> to Lawrence Yun, Chief Economist at the <em>National Association of Realtors</em> (NAR), mortgage rates play a significant role in buyer demand and, by extension, home sales. Yun highlights the positive impact of stable rates:</p>
<blockquote><p><em>“Mortgage rates heavily influence the direction of home sales. Relatively steady rates have led to several consecutive months of consistent home sales.”</em></p></blockquote>
<p><strong style="color: black;">As a seller, hearing that home sales are consistent right now is good news. It means buyers are out there and actively purchasing homes.</strong><span style="color: black;"> Here’s a bit more context on how mortgage rates have impacted demand recently. </span></p>
<p><span style="color: black;">When mortgage rates surged dramatically </span><a href="https://www.freddiemac.com/pmms/archive" rel="noopener noreferrer" target="_blank">last year</a><span style="color: black;">, escalating from roughly 3% to 7%, many potential buyers felt a bit of sticker shock and decided to hold off on their plans to purchase a home. However, as time has passed, that initial shock has worn off. Buyers have grown more accustomed to current mortgage rates and have accepted that the record-low rates of the last few years are behind us.</span> As Doug Duncan, SVP and Chief Economist at <em>Fannie Mae</em>, <a href="https://www.housingwire.com/articles/consumers-may-be-coming-to-terms-with-elevated-rates-and-high-home-prices-fannie-mae/" rel="noopener noreferrer" target="_blank">says</a>:</p>
<blockquote><p><em>“. . . consumers are adapting to the idea that higher mortgage rates will likely stick around for the foreseeable future.”</em></p></blockquote>
<p><span style="color: black;">In fact, a recent </span><a href="https://www.freddiemac.com/research/consumer-research/20230621-housing-sentiment-2Q23" rel="noopener noreferrer" target="_blank">survey</a><span style="color: black;"> by </span><em style="color: black;">Freddie Mac</em><span style="color: black;"> reveals </span><strong style="color: black;">18%</strong><span style="color: black;"> of respondents say they’re likely to </span><strong style="color: black;">buy a home</strong><span style="color: black;"> in the next six months. </span><strong style="color: black;">That means nearly one out of every five people surveyed plan to buy in the near future. </strong><span style="color: black;">And that goes to show buyers are planning to be active in the months ahead. </span></p>
<p><span style="color: black;">Of course, mortgage rates aren’t the sole factor affecting buyer demand. No matter where mortgage rates stand, people will always have reasons to move, whether it’s for job relocation, changing households, or any other personal motivation. As a </span><a href="https://www.simplifyingthemarket.com/2023/06/29/where-will-you-go-if-you-sell-newly-built-homes-might-be-the-answer/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">seller</a><span style="color: black;">, you can feel confident there is a market for your house today. And that demand is pretty strong as buyers settle into where rates are right now. </span></p>
<h3>Bottom Line</h3>
<p>The way buyers perceive today’s mortgage rates is shifting – they’re getting used to the new normal. Steady rates are contributing to strong buyer demand and consistent home sales. <a href="https://www.simplifyingthemarket.com/2023/06/30/key-reasons-to-use-a-real-estate-agent-when-you-sell-infographic/" rel="noopener noreferrer" target="_blank">Connect</a> with a local real estate agent to get your house on the market and in front of those buyers.</p>
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