Weirton weekly real estate update
Purchasing a first home just got a whole lot more difficult for first time home buyers whom experts say could soon be priced out of the U.S. real estate market writ large.
That’s because the Fed announced the largest interest rate hike since 1994. The increase is anticipated to drive 30-year mortgage rates to levels that will price out millions more potential homebuyers.
Year to date mortgage rates have risen from 3% to around 6%, meaning monthly mortgage payments for a $400,000 home purchased today have effectively risen 42% from what they would have been six months ago, according to MarketWatch.
The most concerning part? Builders and real estate experts don’t expect home values to decrease with the looming recession.
The dual forces of inflated home values and higher interest rates threaten to pinch Americans looking to get into a new home. And overall those same Americans are not seeing their wages increase at nearly the same level as other goods and services, housing included. The Fed has argued it must raise rates dramatically to cool the red-hot U.S. economy and prevent further price inflation.
And it is cooling. Home sales have been dropping month after month as the Fed has raised rates, and the market is expected to slow even further over the remainder of 2022. Big real estate firms are announcing massive layoffs this week – an indication that industry leaders see slower growth ahead.
ZeroDown compiled a weekly real estate market report in Weirton, WV metro area using data from Redfin. Statistics are as of the week of June 12, 2022.
