 |
| Brandon Nelson/Unsplash |
The global housing market seems to be nursing the brake pedal again. After a year synonymous with huge demand, soaring prices and record sales, there seems to be a cool-down afoot.
While this isn’t a crash, it can be a temporary pause of sorts.
The biggest reason
Higher mortgage rates and financing costs for homes, making things unaffordable for many buyers.
Slowdown Signs
1️⃣ Higher housing unsold inventory and active listings, indicating slightly lesser demand.
2️⃣ Further price drops - For a long time, housing sales were seeing bidding wars and price hikes. However, with buyers facing affordability squeezes, there is lower buying competition. Many sellers are thus reducing prices to attract more buyers.
3️⃣ More real estate layoffs - Many global realty firms are laying off employees in response to lower market activity. Some of the names on the list include Compass and Redfin.
4️⃣ Lower mortgage demand - Application counts are coming down for mortgages, indicating cooling demand.
5️⃣ Lesser buyers - With affordability issues constraining buyers, thanks to increasing EMI load, there are fewer of them shopping around.
Yet, the hopeful bit is that these are temporary movements. One slash in mortgage rates and the market could start from where it left off.