LINCOLN, Neb. (KOLN) — The housing market across the Midwest is beginning to slow down. Homes are staying on the market longer than homes during the pandemic.
Local real estate agents said this return to normalcy would be good for everyone in the market. Rising interest rates and increased inventory are turning the housing market into an even market instead of favoring sellers.
Lincoln real estate agent Megan Orada said the “cool down” starts at the top.
“In those million-plus price points it’s really starting to happen as well,” Ourada said. “We see that trickle down. So, next year, I think maybe year, we’ll see that switching and become a similar market.
The government is increasing the interest rates, which is affecting the buying of houses. At the beginning of 2022, the average mortgage rate for a 30-year loan was 3.1%, according to NerdWallet. Now it has almost doubled to 5.8%.
“People are seeing what they were approved for in February this year as well,” Orada said. “Compared to now, their purchasing power has decreased as interest rates have gone up.”
There is an uptick in inventory. Ourada said there are about 800 listings available at Lincoln right now. In pre-COVID times, the average was around 1,500. At its lowest level in 2021, it was at 375.
“Inventory levels are rising, we haven’t been growing them for very long,” Orada said. “If we didn’t have any new listings in the market, we would have sold everything in a month. who is fast.”
10/11 Now spoke to several other Realtors on Tuesday who confirmed these. Houses have been on the market for a while, interest rates are rising and on rare occasions, sellers will discount their homes. But he added that compared to pre-Covid, it is still an active market.
Ourada said the average closing price on all properties in Lincoln is $260,000.
“A home that had a $100,000 purchase price this year would probably have been a $60,000 home five years ago. I expect it to be 105,110 in the next year or so, which would be a typical increase in equity.
Ourada said that this change in the market is not a reason for panic among buyers or sellers.
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