Tim Rood Discusses Housing Market Correction on Yahoo!Finance
The housing market continues to cool, amid aggressive tightening by the Federal Reserve – including another 75-basis-point boost in its benchmark interest rate this week. The 30-year fixed-rate mortgage hit 6.29%, a 14-year high, according to Freddie Mac’s Sept. 22 survey. Tim Rood, SitusAMC Head of Industry Relations, spoke with Yahoo!Finance about how these factors will play out in the housing market.
“If you were trying to buy a house last year and taking out a $450K mortgage, that same payment right now would only buy you a $315K mortgage,” he said. “That doesn’t even take into consideration the fact that properties have appreciated pretty measurably since then as well.”
Rood said he expects inventory to dry up as current homeowners become reluctant to let go of their low-rate mortgages, noting that 90% have a rate below 5% and two-thirds have a rate below 4%.
The market is bifurcating into two types of buyers and sellers, and certain metros in the south and west could bear the immediate brunt of the downturn.