Derry's Condo Headshot

Derry's Condo Headshot

Monday, May 9, 2022

Higher Interest Rates are Beginning to Affect our Market

 I have several buyers who have been really frustrated, but things are beginning to look up for them. One client in particular submitted an offer on a property where we were one of six offers and the property sold for significantly over ask. Flash forward to nearly a month later, the same buyer is competing against only one other buyer. 

In conjunction with having fewer buyers, we're adding inventory in some markets. Given, many sellers are thinking that their home is equal or better than the most recent sales in their neighborhoods, list prices continue to trend upward. Couple that with an uptick in interest rates, reducing the purchasing power of buyers and you get a market that begins to even out, or dare I say it, trend in buyers' favor. 

It used to be that buyers couldn't ask much during their request for repairs or some reduced price because their appraisal came in low. That's assuming they weren't all cash. Now, not saying there is opportunity to get a significantly reduced rate due to an appraisal. However, I have a buyer who recently was one of many offers and was surprisingly able to negotiate a little work and a little money back in escrow. 

I also have buyers who are considering backing out of the market all together because their purchasing power has been so reduced. The combination of more inventory and fewer buyers should guarantee that we don't see 20% year over year growth again. 

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