The intense market of the last few years has rocketed home prices up in some of the most competitive districts. But what goes up must come down. A new study has found that most of these homes are now highly overvalued, making them a risky investment.
The exception is Baltimore, which was found to have the most stable market. The best way to dip your toes in these real estate waters is to educate yourself. So, continue reading to learn more about how you can successfully navigate the current Baltimore real estate market as a buyer or seller.
How Do Interest Rates Impact Home Sales?
When the Federal Reserve raises interest rates, the cost of borrowing likewise increases. Although it doesn’t directly impact the price of a home, it can dampen the demand.
This is because a buyer using a mortgage will have a higher monthly payment, which lowers their purchasing power, steering them towards lower-priced houses to compensate.
However, the exception to this is the cash buyer. Since they’re not relying on a mortgage, they’re unaffected by interest rates. And, if you plan to purchase with cash, this is a great time to enter the market since some Baltimore homes will be priced lower, and there will be less competition.
Is The Baltimore Market Cooling?
A survey conducted at the beginning of 2022 found that houses in the Baltimore real estate market were priced 2% less than in the previous quarter. However, while the trend points to a cooling, many say this is instead a recalibration of an unpredictable market.
For first-time buyers, the last two years of two-week listings and 200% contingency-waived offers may seem like the norm. However, those with experience in prior decades know that this was indeed a crazy time, and longer days on market and a slight decrease in the rate of appreciation are to be expected.
However, there are still more people looking for a home than homes for sale, so demand will likely stay high.
Is Now A Good Time To Buy Or Sell A Home?
While the current real estate market is less active than it was last year, it’s still in a healthy condition. If you’re a buyer, you may be faced with a higher cost of lending, but you will also see a slowdown in the crazy bidding process of these past several years. As a seller, the increase in interest rates could mean fewer buyers, slower appreciation, and longer days on market.
However, since there are still not enough homes, demand will not be satiated in the near future, so the potential for competitive sales still exists.
But if you’ve been searching for “how to sell my house fast,” you may be interested in a cash offer to sell your Baltimore, MD house fast.. If this is the case, you may want to research real estate companies that make cash offers.
Make An Educated Decision With This Baltimore Real Estate Guide
Selling or buying a home in the current Baltimore real estate market doesn’t have to be stressful. You can continue to stay abreast of the latest trends to help guide you in the right direction. And don’t forget that working with a real estate professional can give you access to data and expertise you wouldn’t have on your own.
If you enjoyed this article, be sure to explore more in our Real Estate section.
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