If you are contemplating the acquisition of a home, the recent downturn in mortgage rates emerges as favorable news, contributing to an enhancement in affordability. Furthermore, this economic shift has the potential to motivate an increased number of homeowners to part ways with their properties, thereby presenting an additional advantage for you in your pursuit of homeownership.
The Impact of Mortgage Rate Lock-In
In the last year, a significant factor restricting your relocation choices has been the limited housing inventory. This is due to homeowners postponing their selling plans when mortgage rates increased. Instead of moving and acquiring a higher mortgage rate for their next home, these homeowners opted to stay in their current homes with lower rates.
Early Indications Suggest Homeowners Are Prepared to Move Again
Realtor.com’s latest data reveals an increase in new listings, indicating more homeowners were listing their houses for sale in December 2023 compared to December 2022 (refer to the graph below):
Here’s why this holds importance. Normally, the housing market experiences a slowdown in the later months of the year as some sellers postpone their moves until January. For the first time since 2020, we’re witnessing an increase in new listings during this season. This may indicate a relaxation of the rate lock-in effect due to the decline in mortgage rates.
Implications for You
Although it won’t lead to an immediate surge in available homes for your search, it does suggest that more sellers might be opting to list their homes. Consequently, you could expect an increase in the number of homes entering the market, providing you with additional fresh options to consider.
Bottom Line
With the decline in mortgage rates, additional sellers might rejoin the market, offering you a chance to discover your desired home. Reach out to connect with a local expert who can assist you in staying updated on the latest listings in our area.
