The housing market has been on a roller coaster ride in recent weeks, with mortgage rates increasing for the fourth consecutive week due to inflation concerns. This has left some prospective homebuyers feeling hesitant about entering the market. However, there is an upside to this trend, as fewer bidding wars and multiple offer situations mean that homebuyers are likely to get a better deal than in months past.
The 30-year fixed-rate mortgage averaged 6.65% in the week ending March 2, up from 6.5% the week before and 3.76% a year ago. This increase in rates is being driven by ongoing inflationary pressures and economic volatility. While it may seem discouraging to some, the reality is that these factors have created an opportunity for homebuyers to enter the market at a more affordable price.
One of the major benefits of the current market conditions is the reduced competition that homebuyers face. Fewer bidding wars and multiple offer situations mean that buyers are more likely to get the home they want at a better price. This, in turn, means that they will have to borrow less, which can be a significant advantage in the long run.
In addition, Fannie Mae’s updated Selling Guide provides new options for property valuations, moving away from the default requirement of appraisals. The new options include value acceptance, value acceptance plus property data, and hybrid appraisals, with the option chosen matching the risk of the collateral and loan transaction. This means that well-qualified buyers may be able to determine whether they will need an appraisal before the property is in contract, allowing them to waive their appraisal contingency and present a stronger offer to the seller.
Overall, while the current market conditions may be challenging for some, they also present a unique opportunity for homebuyers to enter the market at a more affordable price. With fewer bidding wars and multiple offer situations, and new options for property valuations, buyers can take advantage of these conditions to find the home of their dreams. We have moved away from hard credit pulls for our already free preapprovals, so there’s little reason not to get preapproved, so that you’re ready if the right opportunity presents itself. Click here to set up a time to chat about your options.