Published on our October 2023 Newsletter
Question: “What effect has the increase in mortgage rates had on buyers and sellers?
Here are the three things which have the potential to affect on Buyers:
- The cost of homeownership has increased.
- It is affecting the ability of some buyers to qualify for a mortgage.
- In markets such as this, some lenders tend to become a little more conservative. While we don’t expect them to change guidelines, we do expect that they may become more conservative in their pricing.
Sellers could be affected in these ways:
- Second home sales, whether houses or condos, may begin to slow. This is a big part of the St. Croix market.
- Investment and speculative buying may also begin to slow. These buyers are likely to search out other investment options which may b more attractive as rates increase.
- As the real estate markets and players try to “right size” themselves after a few boom years, we may find that Days on Market will be affected.