How the Vegas Market Is Shifting
How changing market conditions will impact buyers and sellers.
We’ve all been feeling the effects of rising prices across the board, and real estate is no exception. The Federal Reserve adjusted interest rates this year, causing them to shoot up over two points in the last couple of months. That, in turn, prompted many buyers to pump the breaks on their purchases. Every time the interest rate goes up by one point, a buyer’s purchasing power drops by 10%. For example, a million-dollar buyer might be forced to look in the $800,000 price range.
On the other hand, home prices have gone up, though not as much as they used to. The average price of a home rose from $475,000 in April to $482,000 in May.
"Every time the interest rate goes up by one point, a buyer’s purchasing power drops by 10%."
What does this all mean for buyers and sellers? If you’re a buyer, this is good news because it means you’ll have more choices to pick from and you won’t necessarily have to offer exorbitant prices in order to secure a home. Plus, by buying a home soon, you can begin to build up your equity and personal wealth.
For sellers, it means that you can’t overestimate how much buyers are willing to spend. Just because your neighbor got 20% above their asking price, doesn’t mean your house will sell for that much. The market is becoming more balanced, meaning you’ll have to price your home more in line with market values. Homes will continue to appreciate, albeit at a slower rate, so you can still get top dollar for your home when you list.
If you have any questions about what’s going on in the market or how conditions affect your plans to buy or sell a home, don’t hesitate to give us a call or send us an email. Hope to hear from you soon!