According to the Honolulu Board of Realtors, homes sales have been declining since August 2018. In addition, the median sales price for single-family homes have been falling too. Based on this data, I believe we’re starting a new housing cycle.
As the new year began, I was able to help two first-time home buyer clients. Due to economic uncertainty, caused by the government shutdown, mortgage rates went down. Both sets of clients were able to lock-in a sub 5% mortgage rate.
Mortgage rates, like a stock price, fluctuates daily. Rates can go and rates can do down. Although mortgage rates have recently declined, analysts are projecting that mortgage rates will eventually jump backup to the 5% range in 2019.
Higher mortgage rates will pose a problem to many millennial, first-time home buyers. With rates increasing, some buyers will be squeezed out of the market. In addition, let’s not forgot how we have a low inventory.
If you’re looking to purchase your first home, right now might be a great time. The market can be favorable to buyers since prices are dropping and since mortgage rates are under 5%. I’ve been showing a lot of properties and I’ve noticed many listings have been sitting on the market. As the housing market continues to soften, millennial, first-time home buyers can get some leverage on the negotiation table.