Local realtor explains price shift after rise in mortgage rates
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ALBUQUERQUE, N.M. – Local realtors say prices are finally coming down and more houses are up for sale, but the housing market might not be cooling off just yet.
Albuquerque realtor John Lopez says the increase in mortgage interest rates have caused a shift.
“The higher interest rate does create more of an affordability situation, but the higher interest rates did taper off as far as the sales price,” said Lopez.
He says the market created inflated home prices and now a correction is taking place with properties lowering prices by thousands.
Lopez says the new price points are just where the homes should have been listed at to start with.
“In the last six months, we were averaging about 300 price reductions per month for the whole MLS. As of last month, we saw 640 price reductions. That was actually an indication the market was getting a little bit more stable,” he said.
Lopez says this gives first-time homebuyers, and local New Mexicans, a better chance to buy a home. Lower pricing, more supply, and staying on the market longer.
Make no mistake though, he says it’s still a seller’s market because the supply is still far below what would be considered balanced.
“In March, in the Albuquerque area, we literally got down in the 300s of single family residents. Now we’re up to about 800,” said Lopez.
So what if you were someone who bought at the top of the market paying top dollar? Lopez says keep in mind that you probably got a really low interest rate, so it balances out.
He also says home values will continue to grow, just not at the pace we saw the last couple of years.