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In the midst of headline reports about U.S. home prices taking a year-over-year dip for the first time since 2012, it’s important to remember that real estate trends can vary greatly by location. In Sacramento, as we step into September 2023, we find a unique situation. Mortgage interest rates are scaling heights not seen in years, sparking understandable concern among potential homebuyers. If you’re one of them, you might be wondering if this means real estate is becoming more affordable. Let’s take a closer look.
High mortgage interest rates might logically suggest that home prices are set to decrease. However, the reality is more complex, thanks to the interplay of supply and demand. Sacramento County, much like the broader California market, is grappling with an inventory crisis. Many homeowners are locked in historically low interest rates below 3%, making it less enticing for them to sell their homes. This has led to a shortage of homes for sale and a scarcity of motivated sellers.
For buyers coming to terms with the prevailing high interest rates, the situation can be challenging. Some still hold out hope for rate decreases, while others accept the new norm. Despite the rise in mortgage interest rates, California’s property values have continued to climb.
If you’re concerned about these market dynamics, there are steps you can take. One option is to request credits, which can serve various purposes. These credits can be used to cover your closing costs, reducing your out-of-pocket expenses. They can also be employed to buy down your interest rate by a few percentage points or even pay for upfront private mortgage insurance (PMI) payments if you’re putting down less than 20%.
Whether you’re a prospective homebuyer or seller, staying informed about the market’s status and your property’s value is crucial. In Sacramento County, the market’s intricacies require a nuanced approach. If you’re looking for guidance or have questions about your real estate journey, don’t hesitate to reach out. You can call or send a direct message to get the conversation started.
Understanding the supply and demand factors at play, exploring available options like credits, and seeking expert advice can help you navigate these uncertain times. If you know someone who could benefit from this information, feel free to share this article with them. If you have any questions, please reach out to us by phone or email.
