Layne Thompson Real Estate›
*The most immediate impact to homebuyers this spring has been the spike in mortgage rates as the Federal Reserve has sought to temper inflation. *Mortgages now compared to just a few months ago are costing more money for homebuyers. For a median-priced home, the price difference is $300 to $400 more per month, which is a hefty toll for a working family. *Purchasing a home is now 55% more expensive than it was just a year ago. *Wages have risen by 6% from one year ago and that’s good news, but inflation is at 8.5%. *Is there a bubble? Federal Reserve researchers have warned U.S. housing prices have become “unhinged from fundamentals,” but they say it’s not at all like the bubble that preceded the market crash and global financial crisis in 2007 and 2008. While prices are at record highs, experts don’t see the same level of speculation that contributed to the Great Recession. Today’s demand is real, they say, especially in rapidly growing states like UTAH, which already faced a housing shortage far before the pandemic sent the national housing market into upheaval. Here in UTAH, local experts have said rising mortgage rates will likely only slow — not stop — housing price increases while pricing out even more potential homebuyers.
