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Market Update with Garrett Forbes and Meinoh Kim March 2022

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REALTOR® Garrett Forbes


Supply remains an issue, with new listings down 7% compared to the same period in 2021

 The pace of that decline has been shrinking since the start of the year, though, Realtor.com says, and we could start to see a growth in listings compared to 2021 by March or so, right as the spring (typically a busy time for realtors) arrives.

“That said, buyers shouldn't linger if they're considering a bid. Because inventory is low, homes are spending 12 fewer days on the market, on average, than they did a year ago. A typical home spent just 54 days on the market in December, the site says. That's faster than any pre-pandemic year’s fastest month.

Homebuyer Sentiment Dips as Rates Rise: Consumers are feeling less positive about buying in the housing market at the start of the year, as prices remain elevated and mortgage rates continue their upward trajectory. C.A.R.’s monthly survey showed home buying sentiment in California dipped to 19% after reaching an 8-month high of 22% in December. It was the eighth time in the past nine months that less than 20% of respondents said now is a good time to buy a home. With housing supply not expected to rise meaningfully and home prices projected to increase further in 2022, heated market competition and low housing affordability continue to be the utmost concerns for many buyers. Nearly three-quarters of all respondents, on the other hand, said now is a good time to sell.”

GARRETT FORBES   
REALTOR®

DRE #01975558 
Phone: 707.975.0896

MEINOHKIMLOGO1.pnggarrett@levelupbrokerage.com 
LevelUpBrokerage.com 

Lender Meinoh Kim

 

Interest rate forecast per MBS Highway expectations

v  2021 inflation increased from 1.75% to 7%, Powell thought “transitory”

v  Higher inflation caused mortgage rates to rise from 2.5% to 3.375%

v  Fed is currently tapering their purchases of Mortgage Bonds and Treasuries – will not hike and reduce purchases at the same time

v  Done tapering in March, likely to begin hiking in April

v  Fed targeting four rate hikes in 2022 and two or three more in 2023

v  Inflation and interest rates can still rise until Fed acts

v  If Fed can tame inflation, mortgage rates should drop, but may be from higher levels

 

We anticipate mortgage rates to rise along with inflation during first part of the year towards 3.75% to 4%

With Fed action, softer stock market, and slowing economic conditions, interest rates should head lower in second part (forecast only)

 

That said, rents will continue to rise above 5% so if you

 have a buying opportunity now, take advantage of it since supply will remain tight due to supply chain disruptions, semiconductor shortages, and higher rates


Meinoh Kim  MEINOHKIMELITECLUBLOGO1.png                                                                                                                
NMLS# 1058063
Loan Consultant

Phone: 925.586.000
meinohkim@loandepot.com
loandepot.com/meinohkim

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