This housing market has been a wild ride in 2022, from soaring home prices, low inventory, and now rising interest rates. The changes have many people wondering what’s going to happen to the local Springfield housing market.
Homebuyers are feeling the 1-2 punch from both rising home prices and mortgage rates. Home prices have been hitting all-time highs with low inventory and quick sales. The higher mortgage rates will start to cause homes to be on the market longer. It should also start to return home price increases to more normal levels.
Federal Reserve Rate Hike
The Federal Reserve made history last week by hiking rates by three-quarters of a percentage point for the second straight month. This is the most aggressive tightening in more than a generation hoping to curb the highest inflation on over 40 years.
Dr. Jessica Lautz with the National Association of Realtors said, “However, fewer buyers will be able to afford a home because of rising interest rates and increasing home prices. While unaffordable housing isn’t a good thing, it does mean that buyers still in the market may have more time to find the perfect home.”