It’s still a seller’s market
Although market conditions vary by neighborhood and price range, we continue to be in a seller’s market overall. The main driver is a lack of supply, with the inventory of available homes continuing to trend down - especially for homes in more affordable price ranges. The trend of appreciating home values also continues, with average sales prices in the metro Detroit area up about 5.3% from last year.
That said, there are some signs the market might be cooling off a bit. According to the latest report from the Mortgage Bankers Association, applications for new mortgages are down about 6.1%, which is the 4th consecutive week of declines. So far, this has not had any measurable impact on the housing market in our area.
We may see some softening of buyer demand as the year progresses, but it’s unlikely the market will shift dramatically. That’s because interest rates remain low at an average of 4.65% for a 30-year fixed loan, and most lenders I’ve talked with do not expect a major increase this year. This should keep buyers in the market and competing for the limited inventory.