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If you’re like a lot of homeowners, you’ve probably thought: “I’d like to move… but I don’t want to give up my 3% rate.” That’s fair. That rate has been one of your best financial wins – and it can be hard to let go. But here’s what you need to remember…

A great rate won’t make up for a home that no longer works for you. Life changes, and sometimes, your home needs to change with it. And you’re not the only one making that choice.

The Lock-In Effect Is Starting To Ease

Many homeowners have been frozen in place by something the experts call the lock-in effect. That’s when you won’t move because you don’t want to take on a higher rate on your next home loan. But data from Federal Housing Finance Agency (FHFA) shows the lock-in effect is slowly starting to ease for some people.

The share of homeowners with a mortgage rate below 3% (the yellow in the graph below) is slowly declining as more people move. And while some of the people with a rate over 6% are first-time buyers, the number of homeowners with a rate above 6% (the blue) is rising as others take on higher rates for their next home: 

And while it may not seem that dramatic, it’s actually a pretty noteworthy shift. The share of mortgages with a rate above 6% just hit a 10-year high (see graph below). That shows more people are getting used to today’s rates as the new normal.

Why Are More People Moving Now, if It Means Taking on a Higher Rate?

It’s simple. Sometimes they can’t put their life on pause anymore. Families grow, jobs change, priorities shift, and a house that once fit perfectly may not fit at all anymore – no matter how good their rate was. And that’s okay. As Chen Zhao, Head of Economic Research at Redfin, explains:

“More homeowners are deciding it’s worth moving even if it means giving up a lower mortgage rate. Life doesn’t standstill—people get new jobs, grow their families, downsize after retirement, or simply want to live in a different neighborhood. Those needs are starting to outweigh the financial benefit of clinging to a rock-bottom mortgage rate.”

First American refers to these life motivators as the 5 Ds:

•  Diplomas: People with college degrees typically earn more, and that adds up to more buying power. Maybe you bought your house when you were younger and now that you’ve graduated and have a rising career, you’re ready to move up.
•  Diapers: You’ve outgrown your space. If you’re welcoming a new baby, your current home might not be cutting it anymore.
•  Divorce: Whether it’s ending a marriage (or starting one), it can create the need for a new place to call home.
•  Downsizing: You’re ready to downsize. Maybe the kids have moved out and it’s time to simplify. Smaller house, less maintenance, more freedom.
•  Death: If you’ve recently lost a loved one, maybe you’ve realized you want to be closer to family. Life’s too short to live far from the people who matter most.

Whatever your reason, here’s what you need to think about. Yes, your low rate is great. But staying put means your life may stay on hold. And maybe that’s not working for you anymore.

According to Realtor.com, nearly 2 in 3 potential sellers have already been thinking about moving for over a year. That’s a long time to press pause on your plans. On your needs. On your family’s goals. So, maybe the question isn’t: “Should I move?”

It’s actually: “How much longer am I willing to stay somewhere that no longer fits my life?”

Because we’ve already seen rates come down from their peak earlier this year. And they’re expected to ease a bit more in 2026. When you stack that on top of the very real reasons you may need a new home, it may be enough to finally move the needle for you.

Bottom Line

Life doesn’t wait for the perfect rate. Maybe you shouldn’t either.

With mortgage rates down from their peak and forecast to dip slightly more in 2026, moving may be more feasible than you think. If you’re ready to see what’s possible in our market, let’s talk.

If you’ve seen headlines about home prices dropping, it’s easy to wonder what that means for the value of your home too. Here’s what you really need to know.

Even with small price declines in some markets, data shows you’re likely still way ahead. And that’s thanks to your home equity.

The Relationship Between Home Prices and Equity

Home equity moves in sync with home prices. When prices rise, equity builds. When prices cool (even just slightly), equity growth does too. Here’s how that’s played out lately.

After the record-setting home price surge of 2020 and 2021, a little cooling was inevitable.

Back then, the number of homes for sale hit a record low. That caused home values (and your equity) to shoot up significantly as buyers fought over limited inventory.

But prices couldn’t continue to rise at that intense pace forever. The market had to moderate at some point, and that’s exactly what we’re seeing right now. 

As more homes have come on the market this year, price growth slowed – so, equity gains did too. And that doesn’t mean you’ve lost ground.

Putting it into Perspective

You probably still have far more equity than you did just a few years ago. And that puts you in a strong position if you want to sell. Here’s the data to prove it.

According to research from Zillow, home prices have risen a staggering 45% nationwide since March of 2020. That’s a big jump.

And in the majority of markets, prices are still rising, just at a much slower pace. But even in the metros where prices are experiencing the biggest declines (the ones making the headlines), the average drop is only about -4%.

So, what’s that really mean? In most places, prices are on the rise, so this isn’t even a concern. But in the few metros where prices are cooling off a bit, the 5-year gains more than offset those small dips.

In other words, these modest declines can’t erase years of growth. Homeowners who’ve been in their houses for several years are still way ahead. Big time. And that’s true pretty much everywhere.

Data from the Federal Housing Finance Agency (FHFA) helps paint this picture. Let’s cast a slightly wider net and look at a state-by-state level this time. Every single state has seen prices go up over the last 5 years. And that means homeowners in each state have much more equity than they did just 5 years ago (see graph below):

Odds are, in most places, if you’ve owned your home for more than a few years, you’ve already built the kind of equity many people could only dream about before the pandemic. And if you sell, you can use it to help you downsize, or move up.

And just in case you’re worried prices will crash and your equity will take a bigger hit in the near future, here’s what Jake Krimmel, Senior Economist at Realtor.com, has to say:

“The slight recent declines in aggregate value and total home equity are not cause for concern . . . Although the market is coming into better balance, large price declines nationally are extremely unlikely in the near term . . .”

The price moderation we’ve seen lately isn’t a cause for concern. It’s a signal of a market that’s finding its balance again after several years of unsustainable price growth. And after several years of major price appreciation, most homeowners are still in an incredibly strong position.

Bottom Line

Even with prices coming down in some markets, today’s homeowners are still sitting on near record amounts of equity.

If you’re wondering how much equity you have (or how far ahead you really are), let’s connect.

You might be surprised by what your home is actually worth today.

You’ve got big plans for 2026. But what you do this year could be the difference between a smooth sale and a stressful one. If you’re thinking of selling next spring (the busiest season in real estate), the smartest move you can make is to start prepping now. As Realtor.com says:

“If you’re aiming to sell in 2026, now is the time to start preparing, especially if you want to maximize the spring market’s higher buyer activity.” 

Because the reality is, from small repairs to touch-ups and decluttering, the earlier you start, the easier it’ll be when you’re ready to list. And, the better your house will look when it’s time for it to hit the market.

Why Starting Now Matters

Talk to any good agent and they’ll tell you that you can’t afford to skip repairs in today’s market. There are more homes for sale right now than there have been in years. And since buyers have more to choose from, your house is going to need to look its best to stand out and get the attention it deserves.

Now, that doesn’t mean you have to do a full-on renovation. But it does mean you’ll want to tackle some projects before you sell. Your house will sell if it’s prepped right. And you don’t want to be left scrambling in the spring to get the work done.

Because here’s the advantage you have now. If you start this year, you’ll be able to space those upgrades and fixes out however you want to. More time. Less stress. No sense of being rushed or racing the clock.

Whether it’s fixing that leaky faucet, repainting your front door, or finally replacing your roof, you can do it right if you start now. And you have the time to find great contractors without blowing your budget or paying extra for rushed jobs.

Get an Agent’s Advice Early

To figure out what’s worth doing and what’s not in your market, you need to talk to a local agent early. That way you’re not wasting your time or money on something that won’t help your bottom line. As Realtor.com explains:

“Respondents overwhelmingly agree that both buyers and sellers enjoy a smoother, more successful experience when they start early. In fact, a recent survey reveals that, for sellers, bringing a real estate agent into the process sooner can pay off significantly.”

A skilled agent can tell you:

•   What buyers in your local area are looking for
•   The repairs or updates you need to do before you list
•   How to prioritize the projects, if you can’t do them all
•   Skilled local contractors who can help you get the work  done

And having that information up front is a game changer.

To give you a rough idea of what may come up in that conversation, here are the most common updates agents are recommending today, according to research from the National Association of Realtors (NAR):

Just remember, what’s worth updating really depends on the homes you’re competing with in your market. Some areas don’t have a ton of inventory, so little updates may be all you need to tackle. In other areas, there are far more homes for sale, so you may need to do a bit more to make your house stand out.

Your agent will walk you through what you need to do for your specific house and market. And that’s expertise that’ll really pay off. 

Bottom Line

If your goal is to sell in 2026, now’s the time to start laying the groundwork. A little prep this fall means you’ll enter the Colorado spring market confident, ready, and a step ahead of sellers who waited until January.

Curious which home projects are giving Colorado sellers the best return right now? Let’s talk — I’ll help you build a clear, stress-free plan for your move.

In Colorado, the notion of “flat” home prices masks a patchwork of local trends—and the numbers back that up. Statewide, the median price of a single-family home dipped about 1 percent in July 2025, settling around $590,000, while condo and townhome prices fell more sharply—down around 6.5 percent year over year. more info

Meanwhile, in the seven-county Denver metro, median prices for single-family homes slipped about 1.2 percent to $630,000. more info Contrast that with the greater metro trend earlier in the year, when median home prices in the Denver region rose 0.8 percent year over year, to about $625,000—a sign that multiple forces are influencing where prices go next. more info

In short: across Colorado and even within Denver’s metro area, price changes aren’t uniform. Some markets are feeling mild pullbacks, others are holding ground, and a few pockets are still showing modest gains. That variation is a reminder that the market is far from flat.

So what’s happening in the rest of the US…

If you’ve been following real estate news lately, you’ve probably seen headlines saying home prices are flat. And at first glance, that sounds simple enough. But here’s the thing. The reality isn’t quite that straightforward.

In most places, prices aren’t flat at all.

What the Data Really Shows

While we’ve definitely seen prices moderate from the rapid and unsustainable climb in 2020-2022, how much they’ve changed is going to be different everywhere.

If you look at data from ResiClub and Zillow for the 50 largest metros, this becomes very clear. The real story is split right down the middle. Half of the metros are still seeing prices inch higher. The other half? Prices are coming down slightly (see graph below).

The big takeaway here is “flat” doesn’t mean prices are holding steady everywhere. What the numbers actually show is how much price trends are going to vary depending on where you are. 

One factor that’s driving the divide? Inventory. The Joint Center for Housing Studies (JCHS) of Harvard University explains:

“ . . . price trends are beginning to diverge in markets across the country. Prices are declining in a growing number of markets where inventories have soared while they continue to climb in markets where for-sale inventories remain tight.”

When you average those very different trends together, you get a number that looks like it’s flat. But it doesn’t give you the real story and it’s not what most markets are feeling today. You deserve more than that.

And just in case you’re really focusing on the declines, remember those are primarily places where prices rose too much, too fast just a few years ago. Prices went up roughly 50% nationally over the past 5 years, and even more than that in some of the markets that are experiencing a bigger correction today. So, a modest drop in some local pockets still puts most of those homeowners ahead when it comes to the overall value of their home. And based on the fundamentals of today’s housing market, experts are not projecting a national decline going forward.

So, what’s actually important for you to know?

If You’re Buying…

You need to know what’s happening in your area because that’s going to influence everything from how quickly you need to make an offer to how much negotiating power you’ll have once you do.

•   In a market where prices are still inching up, waiting around could mean paying more down the line.
•   In a market where they’re easing, you may be able to ask for things like repairs or closing cost help to sweeten the deal.

The bottom line? Knowing your local trend puts you in the driver’s seat. 

If You’re Selling…

You’ll want to be aware of local trends, so you’ll know how to price your house and how much you can expect to negotiate.

•   In a market where prices are still rising, you may not need to make many compromises to get your home sold.
•   But if you’re in a market where prices are coming down, setting the right price from the start and being willing to negotiate becomes much more important.

The big action item for homeowners? Sellers need to have an agent’s local perspective if they want to avoid making the wrong call on pricing – and homes that are priced right are definitely selling.

The Real Story Is Local

The national averages can point to broad trends, and that’s helpful context. But sometimes you’re going to need a local point of view because what’s happening in your zip code could look different. As Anthony Smith, Senior Economist at Realtor.com, article puts it:

“While national prices continued to climb, local market conditions have become increasingly fragmented…This regional divide is expected to continue influencing price dynamics and sales activity as the fall season gets underway.”

That’s why the smartest move, whether you’re buying or selling, is to lean on a local agent who’s an expert on your market. 

They’ll have the data and the experience to tell you whether prices in your area are holding steady, moving up, or softening a bit – and how that could impact your move.

Bottom Line

Headlines calling home prices flat may be grabbing attention, but they’re not giving you the full picture.

Has anyone taken the time to walk you through what we’re seeing right here, right now?

When you put your house on the market, you want to sell it quickly and for the best price possible; that’s generally the goal. But too many sellers are shooting too high right now. They don’t realize the market has shifted as inventory has grown. The side effect? Price cuts are on the rise, but they really don’t have to be. Here’s why.

According to data from Realtor.com, in February, price cuts were the highest they’ve been in any other February since 2019 (see graph below):

If you consider that 2019 was the last true normal year for the housing market – that’s a big deal. We’re getting back to what’s typical for the market.

This isn’t the same frenzied seller’s market we saw a few years ago. You may not get the same price your neighbor did at the height of the pandemic. And that means you may need to reset your expectations.

Because here’s the reality. If you shoot too high and have to lower your price after the fact, you could actually end up walking away with lower offers than if you’d priced it right from the start. So, how do you avoid that? You lean on your agent.

How an Agent Helps You Nail the Right Price

A great agent doesn’t just pull a number out of thin air. They’ll use real data and market trends to make sure your house is priced based on what your specific home is valued at today. So, you’re setting a realistic price – one that’ll draw in serious buyers.

And based on your agent’s analysis of your local market, they may even recommend strategically pricing slightly below market value to help your house attract more eyes and more competitive offers. Here’s how your agent will determine the right number for your house:

•  They look at recent sales. What did similar homes in your area actually sell for? Not list for, sell for.
•  They analyze local market trends. Your home’s value isn’t just about what you want for it, it’s about what buyers in your area are willing to pay.
•  They craft the right strategy. They’ll make sure your home is priced to attract attention and create a sense of urgency among buyers.

Why Overpricing Backfires

Unfortunately, some sellers still ignore their agent’s advice and prefer to start high just to see what happens. The hope being maybe they get their full asking price, or they at least have more wiggle room for negotiation. But pricing high usually ends up costing you, and here’s why:

• Buyers may not even look at it. Today’s buyers are more budget-conscious than ever. If they see a home that seems overpriced, they’re likely to skip it completely rather than try to negotiate.
• It could sit on the market for too long. The longer your home sits unsold, the more buyers will assume something’s wrong with it. That can make it even harder to sell down the line.
• You might end up getting less. Homes that require a price cut often sell for less than they would have if they had been priced right from the start.

You can see that shake out in the graph below. It uses data from the National Association of Realtors (NAR) to show that the longer a house sits, the less it’ll sell for:

This graph shows that if a house sells within the first 4 weeks it is listed, it usually goes for full price. Based on experience, that’s what usually happens to homes that are priced at or just below current market value. If it’s priced right, buyers will be interested, and, ultimately, willing to pay the asking price – or compete with other buyers and even go over asking.

But if a house isn’t priced right, it doesn’t sell as quickly. And this graph shows that, after the first 4 weeks on the market, the price starts to drop from there. That’s because buyer interest falls off the longer it sits. So, it becomes more likely a seller will either accept a lower offer because that’s all they have, or opt to do a price drop to draw people back in.

Bottom Line

The last thing you want is to list too high, watch your house sit, and then have to drop the price just to get attention. Let’s connect so that doesn’t happen to you.

Want to make sure your home sells quickly and for the best price? Let’s go over the right pricing strategy for your house.

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Guardian Real Estate Group does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Guardian Real Estate Group will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.

Recession talk is all over the news, and the odds of a recession are rising this year. And that leaves people wondering what would happen to the housing market if we do go into a recession.

Let’s take a look at some historical data to show what’s happened in housing for each recession going all the way back to the 1980s.

A Recession Doesn’t Mean Home Prices Will Fall

Many people think that if a recession hits, home prices will fall like they did in 2008. But that was an exception, not the rule. It was the only time we saw such a steep drop in prices. And it hasn’t happened since.

In fact, according to data from CoreLogic, in four of the last six recessions, home prices actually went up (see graph below):

So, if you’re thinking about buying or selling a home, don’t assume a recession will lead to a crash in home prices. The data simply doesn’t support that idea. Instead, home prices usually follow whatever trajectory they’re already on. And right now, nationally, home prices are still rising at a more normal pace.

Mortgage Rates Typically Decline During Recessions

While home prices tend to stay on their current path, mortgage rates usually drop during economic slowdowns. Again, looking at data from the last six recessions, mortgage rates fell each time (see graph below):

So, a recession means mortgage rates could decline based on the data. While that would help with affordability, don’t expect the return of a 3% rate.

Bottom Line

The answer to the recession question is still unknown, but the odds have gone up. But that doesn’t mean you have to wonder about the impact on the housing market – historical data tells us what usually happens.

When you hear talk about a possible recession, what concerns or questions come to mind about buying or selling a home?

At one point or another, you’ve probably heard someone say, “Yesterday was the best time to buy a home, but the next best time is today.”

That’s because nationally, home values continue to rise. And with mortgage rates still stubbornly high and home prices going up, you may be holding out for prices to fall or trying to time the market for that perfect rate. But here’s the truth: waiting for the right moment could cost you in the long run.

Home Prices Are Still Rising – Just at a More Normal Pace

The idea that prices will drop dramatically is wishful thinking in most markets. According to the Home Price Expectations Survey from Fannie Mae, industry analysts are saying prices are projected to keep rising through at least 2029.

While we’re no longer seeing the steep spikes of previous years, experts project a steady and sustainable increase of around 3-4% per year, nationally. And the good news is, this is a much more normal pace – a welcome sign for hopeful buyers (see graph below):

What This Means for You

While it’s tempting to wait it out for prices or mortgage rates to decline before you buy, here’s what you’ll need to consider if you do.

• Tomorrow’s home prices will be higher than today’s. The longer you wait, the more that purchase price will go up.
• Waiting for the perfect mortgage rate or a price drop may backfire. Even if rates dip slightly, rising home prices could still make waiting more expensive overall.
• Buying now means building equity sooner. Home values are rising, which means your investment starts growing as soon as you buy.

Let’s put real numbers into this equation. If you purchase a $400,000 home today, based on these price forecasts, it’s expected to go up in value by more than $83,000 over the next five years. That’s some serious money back in your pocket instead of being left on the sidelines (see graph below):

Why Aren’t Prices Dropping? It’s All About Supply and Demand

Even though there are more homes for sale right now than there were at this time last year, or even last month, there still aren’t enough of them on the market for all the buyers who want to purchase them. And that puts continued upward pressure on prices. As Redfin puts it:

“Prices will rise at a pace similar to that of the second half of 2024 because we don’t expect there to be enough new inventory to meet demand.”

While every market is different, most areas will continue to see moderate price growth. Some may level off a bit, but a major national drop? Not likely.

Bottom Line

Time in the Market Beats Timing the Market

If you’re debating whether to buy now or wait, remember this: real estate rewards those who get in the market, not those who try to time it perfectly.

Yes, today’s housing market has its challenges, but there are ways to make it work —exploring different neighborhoods, considering smaller condos or townhomes, asking your lender about alternative financing, or tapping into down payment assistance programs. The key is making a move when it makes sense for you rather than waiting for a perfect scenario that may never arrive.

Want to take a look at what’s happening with prices in our local market? Whether you’re ready to buy now or just exploring your options, having a plan in place can set you up for success.

Over the past few years, home prices skyrocketed. That’s been frustrating for buyers, leaving many wondering if they’d ever get a shot at owning a home. But here’s some welcome news: that whirlwind pace of home price growth is slowing down.

Home Prices Are Rising at a Healthy Pace

At the national level, home prices are still going up, but at a much more moderate, normal pace. For example, in November, the year-over-year increase in home prices was just 3.8% nationally, according to Case-Shiller. That’s a far cry from the double-digit spikes that occurred in 2021 and 2022 (see graph below):

This more normal home price growth might make buying a home feel more attainable for many buyers. You won’t face the same sticker shock or rapid price jumps that made it hard to plan your purchase just a few years ago.

At the same time, steady growth means the home you buy today will likely appreciate in value over time.

Prices Vary from Market to Market

While the national story is one of moderate price growth, it’s important to remember that all real estate is local. Some markets are seeing stronger growth, while others are cooling off or even seeing slight declines. As Selma Hepp, Chief Economist at CoreLogic, notes:

“Regionally, variations persist, as some affordable areas – including smaller metros in the Midwest — remain in high demand and continue to see upward home price pressures.”

Meanwhile, other regions saw slight month-over-month declines in November, according to Federal Housing Finance Agency (FHFA) data (see graph below):

What does this mean for you? It’s crucial to understand what’s happening in your local market. A national average can’t tell the whole story. That’s where working with a local real estate agent can really help. They have the tools and expertise to give you the full picture of what’s happening in your area and how to plan for that in your move.

“With home prices stabilizing, buyers can plan with confidence—less sticker shock now and solid long-term value ahead.” 

– Julie Maeda, Realtor®, Employing Broker

What You Need To Know

Home prices are growing at a more manageable pace, and working with a local real estate expert like our agents at Guardian Real Estate Group can help you navigate the ups and downs of your specific market.

How have changing home prices impacted your plans to buy? Let’s talk about it.

The Answer Might Surprise You!

Have you ever stopped to think about how much wealth you’ve built up just from being a homeowner? As home values rise, so does your net worth. And, if you’ve been in your house for a few years (or longer), there’s a good chance you’re sitting on a pile of equity — maybe even more than you realize.

What Is Home Equity?

Home equity is the difference between what your house is worth and what you owe on your mortgage. For example, if your house is worth $500,000 and you still owe $200,000 on your home loan, you have $300,000 in equity. It’s essentially the wealth you’ve built through homeownership. Right now, homeowners across the country are seeing record amounts of equity.

According to Intercontinental Exchange (ICE), the average homeowner with a mortgage has $319,000 in home equity.

Why Have Homeowners Gained So Much Equity?

The rise in home equity over the years can be credited to two key factors:

1. Significant Home Price Growth

Home prices have climbed dramatically in recent years. In fact, according to the Federal Housing Finance Agency (FHFA), over the past five years, home prices nationwide have risen by 57.4% (see map below):

This appreciation means your house is likely worth much more now than when you first bought it.

2. Longer Tenure in Homes

Data from the National Association of Realtors (NAR) shows people are staying in their homes for a decade (see graph below):

This increased tenure means homeowners benefit even more from home values growing over time. That’s because the longer someone has lived in their house, the more that home’s value has grown, which directly increases equity.

And if you’re one of those people who’s been in their home for 10 years or more, know this – according to NAR:

“Over the past decade, the typical homeowner has accumulated $201,600 in wealth solely from price appreciation.”

The Benefits of Having Home Equity

What does that mean for you? It means your house might be your biggest financial asset — and it could open up some exciting opportunities for your future. Let’s break it down.

• Moving to Your Next Home

Your equity could help you cover the down payment for your next home. In some cases, it might even mean you can buy your next house all cash.

• Financing Home Improvements

Thinking about upgrading your kitchen, adding a home office, or tackling other projects? Your equity can provide the funds to make those improvements happen, increasing your home’s value and making it more enjoyable to live in too.

• Getting a Business Going

If you’ve been dreaming about starting your own business, your equity could be the kickstart you need. Whether it’s for startup costs, equipment, or marketing, leveraging your home’s value can help bring your entrepreneurial goals to life.

Bottom Line

Whether you’re thinking about selling, upgrading, or simply want to understand your options, your home equity is a powerful resource. If you’re wondering how much equity you’ve built or how you can use it to meet your goals, let’s connect and explore the possibilities.

There’s been a lot of focus on higher mortgage rates and how they’re creating affordability challenges for today’s homebuyers. It’s true that rates climbed dramatically since the record-low we saw during the pandemic. But home affordability is based on more than just mortgage rates – it’s determined by a combination of mortgage rates, home prices, and wages.

Considering how each one of these factors is changing gives you the full picture of home affordability today. Here’s the latest.

1. Mortgage Rates

While mortgage rates are higher than they were a year ago, they’ve hovered primarily between 6% and 7% for nearly eight months now (see graph below):

As the graph shows, mortgage rates have experienced some volatility during that time. And even a small change in mortgage rates impacts your purchasing power. That’s why it’s so important to lean on your team of real estate professionals for expert advice to stay up to date on what’s happening in the market. While it’s hard to project where mortgage rates will go from here, many experts agree they’ll likely continue to remain around 6%-7% in the immediate future. 

2. Home Prices

Over the past few years, home prices appreciated rapidly as the record-low mortgage rates we saw during the pandemic led to a surge in buyer demand. The heightened buyer demand happened while the supply of homes for sale was at record lows, and that imbalance put upward pressure on home prices. However, today’s higher mortgage rates have slowed down price appreciation.

And, the truth is, home price appreciation varies by market. Some areas are seeing slight declines while others have prices that are climbing. As Selma Hepp, Chief Economist at CoreLogic, explains:

“The divergence in home price changes across the U.S. reflects a tale of two housing markets. Declines in the West are due to the tech industry slowdown and a severe lack of affordability after decades of undersupply. The consistent gains in the Southeast and South reflect strong job markets, in-migration patterns and relative affordability due to new home construction.”

To find out what’s happening with prices in your local market, reach out to a trusted real estate agent.

3. Wages

The most positive factor in affordability right now is rising income. The graph below uses data from the Bureau of Labor Statistics (BLS) to show how wages have grown over time: 

Higher wages improve affordability because they reduce the percentage of your income it takes to pay your mortgage since you don’t have to put as much of your paycheck toward your monthly housing cost.

Home affordability comes down to a combination of rates, prices, and wages. If you have questions or want to learn more, reach out to a real estate professional who can explain what’s happening locally and how these factors work together.

Bottom Line

If you’re planning to buy a home, knowing the key factors that impact affordability is important so you can make an informed decision. To stay up to date on the latest on each, let’s connect today.