Home sales are declining as frustrated buyers sit on the sidelines. Higher rates add hundreds of dollars in interest for would-be buyers. After two years of red-hot growth, the housing market has stalled. Higher rates are making it tough for buyers. The 30-year fixed interest rate was trending slightly below 7%, according to Mortgage News Daily. Seattle saw a 3.4% decline in homes valued at $1 million or more. The share of homes in the U.S. that are worth at least $1 million fell to 7% in January 2023, from an all-time high of 8.6% in June 2022.
A weak demand is also pushing house prices down. To calculate the value of homes, Redfin used a proprietary model called the ‘Redfin Housing Value Index,’ which includes a Redfin Estimate, public records, and data from the multiple listing service (or MLS) to estimate the current and historical value of homes. They looked at more than 99 million properties in the U.S., including single-family houses, townhomes, condos, and apartments. Real Estate investors should be looking closely now as there are huge opportunities in various areas. Price is king.
The dip in prices is being balanced out by higher rates. “Now isn’t the time for buyers who need to take out a loan to get a good deal: Buying an $800,000 home today would cost more per month than buying a million-dollar home a year ago.” Seattle’s housing market is priced far higher than the national median, at just $394,000, itself a 2.9% increase year over year.
In January 2023, Seattle home prices were up 4.5% compared to last year, selling for a median price of $763K. On average, homes in Seattle sell after 43 days on the market compared to 19 days last year. There were 350 homes sold in January this year, down from 624 last year.
Kin. not all is bad. Those with connections to real estate in Florida or looking to go to thecwarm state to retire there are some bright spots. More homes in Florida are worth more than $1 million, per Redfin. According to the report, 1 in 7 homes in Miami are worth at least $1 million — a 11.5% increase from a year ago. North Port, Fla., Anaheim, Calif., Nashville, Tenn., and West Palm Beach, Fla., are all doing well with million dollar home values.
