Two years ago, the average 30-year mortgage rate on a home was about 3.2%. Today, it's flirting with 8%. That's a huge difference, according to John Chang, National Director Research and Advisory Services, Marcus & Millichap.
In other words, someone who would've qualified for a $300,000 loan at a 3.2% mortgage rate would now only qualify for a loan of about $200,000 with a mortgage rate of 8%.
Speaking on a news video for his firm, Chang said this combination of reduced purchasing power with higher interest payments, in conjunction with a 10% rise in median home prices over the last two years, and a significant reduction of houses for sale, has resulted in a 35% decline in existing home sales since September 2021.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
