If you bought a home a decade ago, the buying process was probably fairly slow. Homes would sit on the market for weeks or even months. People would consider various homes and walk away from all sorts of offers and deals. It was simply not a quick process, either for buyers or sellers.
Conversely, if you bought a home over the last few years, you probably noticed that homes move through the market extremely quickly. There were even cases of homes selling in just a few days, and people knew that they had to make an offer – sometimes without even seeing the house in person – as fast as they could.
Today, home sales are certainly faster than they have been in the past, but they are slowing down compared to the last few years. Why is this happening?
Interest rates are much higher
A big reason for this is simply that interest rates on loans are a lot higher right now than they were over the past two or three years. People used to get mortgages around 3 or 4%. Now, most interest rates are around 7%.
In addition, inflation and other factors have caused home values to increase. This, combined with the higher interest rates, means that it is prohibitively expensive for many people to actually purchase a home. While this is bad news for those who have been priced out of the market, it is good news for those who are still looking. They will have longer than they used to, and they may have a larger supply of potential homes to choose from.
That being said, the market is always moving and changing. Those who are looking to buy a home need to make sure they know exactly what steps to take.