Whoa - Who Pulled the Emergency Brake on the Housing Market?

Wow! Who pulled the emergency brake on the housing market? It may seem as though the housing market is making a 180-degree turn or coming to a full stop, but, once put in perspective, it’s more normal than you might think. 

Is it a buyers’ market? No, however the heat of the last couple of years on the selling side is starting to cool. What does this mean for a VA Mortgage loan? It starts looking even better than before. We at VALoansMN are seeing the VA backed home loans are now a bargain compared to some other mortgages. You may have noticed recently mortgage rates hovering at or slightly above SIX PERCENT. VA loans were substantially better in many cases. What is the current VA mortgage rate? That is a question we at VALoansMN receive most often. Our answer is “it all depends”. It depends on your credit history, your FICO scores, the amount of debt in relation to your income and more. VA mortgage rates are very individual. Please call Brad (612-240-9922) and he’s more than happy to dig a little deeper with you so you have accurate and timely information. Granted we’ve been focused on home buying and selling but a refinance of a VA loan is still very attractive and easy. 

If we’re not in a buyers’ market for housing where are we? Picture this: there are two arm wrestlers. One represents buyers and the other sellers. For the past 3 years the selling wrestler had the strength pushing the buyers arm back to a 45-degree angle. Now the buyers’ side is showing more strength and pushing toward the starting point (90-degrees from the table). As of this writing the buyers are sellers are not equal with arms at 90-degrees. That might soon come.

In an equal housing market we see the rapid appreciation of prices slow to a more sustainable pace. When buyers and sellers have equal bargaining strength we will see home prices appreciate at the rate of inflation. Latest data on that is showing an inflation rate of about 8.5%. Might houses depreciate? No one knows for sure but looking at historical data it does not appear likely at this time. Yes, we are seeing some price reductions but it’s most likely those are sellers who thought they could still get a price inflated during the past 18 months of value. Now, they’re facing the current reality and backing off their dream sales price.

Be aware we are NOT predicting the future of mortgage rates or home prices but we are presenting this opinion based on historical fact. PLEASE call Brad at VALoansMN and let him sort out details which apply to your personal situation whether it be to purchase or refinance your mortgage loan. It’s what we do every day.