Whether through anecdotes or headlines, you may have heard that we are in a hot housing market in Massachusetts.
A peak in demand for housing combined with a limited housing supply coupled with historically low interest rates has made for a very “hot” market with sky-high prices. SVP and Director of Residential Lending, Bob Driscoll, breaks down how the current market, in general, is affecting homebuyers and sellers.
Buyers are facing stiffer competition for housing and sellers have the upper hand. But why? Much of this is attributable to the fact that homes have become even more valuable than ever during the COVID-19 pandemic — people have been living, working, exercising and socializing within the relative safety of their homes in contrast to spending time in public settings. Many homeowners have retrofitted their homes to meet their current needs and those changes have reduced their desire to sell their homes. Some sellers are also hesitant to make big life changes, like putting a home on the market, in times of fluctuation and uncertainty.
There are also economic factors at play, like favorable mortgage interest rates that are enticing buyers to buy now while also leading homeowners to refinance and stay put. Other factors like changing credit scores needed to qualify for a mortgage, supply and regulation issues for building new housing and COVID-induced mortgage relief for owners have all compounded to create the perfect storm.
On the bright side, Bob suggests that buyers stay patient, especially FTHB, the market will cool and there will be an opportunity, likely in 2023, where they will be able to reach their goal of homeownership and balancing out for buyers and sellers.
With hopeful buyers facing high prices, credit challenges and a limited number of options, Bob notes that the rental market continues to rise. If you’re a potential buyer, take a look at your financial picture and consider adjusting your homebuying timeline. It’s also an ideal time to save for a down payment and wait for the home you want to live in, not just the home you can afford.
For current homeowners, it’s an opportunity to re-evaluate the value of your home and living space. You may decide it’s the right time to sell for a high price, but alternatively, you may choose to refinance your mortgage. Or, you could reinvest in your property to turn your home equity into home improvements.
Whether you’re looking to buy, sell or maintain your current home, our qualified team of mortgage specialists understand the housing market and can help you make an informed decision that suits your unique needs. Check out the other resources on our Learning Center or stop by your local branch today!