Tag: Interest Rates
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Home Price Growth Stagnates as Rates Dampen Market Activity
Higher mortgage rates and overall affordability woes are leading to drop off in activity in the Twin Cities housing market on both the buyer and seller ends of the spectrum. Consequently, the median home price in the metro area saw a minute 0.6 percent growth to $342,000 in February. Moreover, the overall housing market is […] Read More
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Despite Headwinds, Builder Confidence Grows in February
Homebuilder sentiment rose for the second consecutive month, according to the latest report from the National Association of Homebuilders. Builder confidence in the market increased seven points in February to 42 – the second strongest reading since September 2022. This latest report, driven by softening mortgage rates and increasing demand for inventory, comes despite rising […] Read More
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Higher mortgage rates sidelined buyers in 2022
According to new data from Minneapolis Area REALTORS® and the St. Paul Area Association of REALTORS®, the Twin Cities housing market last year was a tale of two markets. The first half of 2022 reflected much of the all-out frenzied feeling of the previous year and a half. Fierce and competitive buyer activity with multiple […] Read More
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Fed raises rates by 75 basis points
In its continued effort to fight inflation, the Federal Reserve raised the federal funds target rate another 75 basis points mid-September. This is the third consecutive increase of 75 basis points. The large hikes are sending shockwaves through the financial markets and the overall economy. Federal Reserve officials have now hinted at plans to continue […] Read More
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Housing inventory remains low even as housing market shifts
Across the country rising mortgage rates and inflation have had a stifling impact on the housing market. It is no surprise when considering that from the start of the year, mortgage rates have more than doubled, increasing from 3% in January to rates now over 6% this fall. Permits for new single-family homes have fallen […] Read More
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Millennials want to own homes, but affordability stands in the way
Rising interest rates, coupled with an already tight and competitive market, are impacting purchasing power of would-be homebuyers. Consequently, the housing market is starting to see a shift in who is buying homes — especially in the millennial age group. Millennials are now the largest generation of potential homebuyers, but this age group is becoming […] Read More
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Not all housing markets are the same
As mortgage rates hurdled over 6% in September, the highest level on record since the Great Recession, buyers are starting to become more hesitant during their home search. Many buyers are even being completely priced out of the market. Concerns over rising interest rates, delays in project timelines, rising construction costs, labor shortages and other […] Read More
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Builder confidence stumbles as market conditions shift
Market headwinds are taking their toll on builder sentiment. Increasing mortgage rates, labor shortages and continued material challenges are proving to be roadblocks to home construction this summer, and homebuilders are feeling the effects. The National Association of Home Builders’ (NAHB) monthly confidence index reported a nearly record-level drop in sentiment in July. The index […] Read More
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Interest rates and affordability cause cooling
effect on Minnesota’s housing marketAs the Federal Reserve continues to raise interest rates in an attempt to bring down 40-year-high inflation, it has had a clear impact on the local housing market. Minnesota was facing a housing inventory and affordability crisis prior to the Fed raising rates, which was pricing many families out of homeownership. With the Fed’s efforts […] Read More
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Consumer sentiment toward homebuying plummets
It appears rising interest rates pushed consumers over the edge when it comes to whether it is a good time to buy a home. According to Fannie Mae, the Home Purchase Sentiment Index® (HPSI) decreased by 4.7 points to 68.5 in April, its lowest level since May 2020, as surveyed consumers expressed heightened concerns about […] Read More
