The Mortgage Mashup Blog
|Posted on February 14, 2018 at 12:30 AM|
If mortgage rates keep rising to break the 5% barrier, most homebuyers will go right ahead with their purchase anyway.
Just 6 in 100 prospective homebuyers surveyed by Redfin said they would halt their planned home purchase if rates were above 5%, although a further 27% would slow their search.
A quarter of respondents said that a 5% rate would make no difference to their plans, 1 in 5 would speed up their search and a similar share would look to cheaper neighborhoods or a smaller property.
If rates aren’t a problem, what is?
The survey was carried out in November / December 2017 when the tax reform debate was causing concern; 38% of respondents said it was their top worry.
This was an even higher concern among those in highly-taxed areas, especially California.
Those in Seattle and Portland were most concerned about affordable housing, which was also a big concern in Denver.
Three quarters of respondents nationwide thought home prices would continue rising in 2018, 25% said they thought the increases would be significant.
"Tight credit, lack of inventory and high demand are the major factors that tell us there's no housing bubble, despite rapid price increases," said Redfin chief economist Nela Richardson. "There are still many more buyers than the current housing supply can support, with no major relief in sight. Strict lending regulations make it much harder to buy a house you can't afford than during the housing boom a decade ago. Finally, still-low interest rates somewhat offset high prices for some buyers."
More market update:
• Proposed HUD budget to boost homeownership, healthy homes
• Brokers are confident as long as they can attract agents
Stay Tuned for more info,
Yours in service,
Territory Manager, Land Home Financial Service, Inc.