Homebuyer Activity Shows Signs of Warming Up for Spring
As more buyers enter the market, the spring season appears to be heating up in the housing market. And, after rising mortgage rates kept so many buyers out of the market last year, that's a good sign for sellers. Realtor.com has the most recent information:
“Spring is officially here, and like green shoots emerging from the bleak winter, new data suggests that more buyers are back in the market, although more subdued compared to a year ago.”
Because of mortgage purchase application data, we know that buyer activity is increasing. Investopedia reports:
“A mortgage application is a document submitted to a lender when you apply for a mortgage to purchase real estate.”
That is, the number of mortgage applications indicates how many buyers are looking for loans. In other words, an increase in mortgage applications indicates an increase in buyer demand, and as Joel Kan, VP and Deputy Chief Economist at the Mortgage Bankers Association (MBA), explains, application activity began to pick up in March as mortgage rates continued to fall steadily:
“Application activity increased as mortgage rates declined . . . recent increases, along with data from other sources showing an uptick in home sales, is a welcome development.”
In fact, we can see how mortgage rates affect applications over time. As interest rates increased dramatically last year, applications decreased in response (see graph below):
The recent increase in mortgage applications, combined with the recent decline in mortgage rates, is good news for sellers because it indicates that more buyers are actively looking for homes.
What Does This Mean for You?
Buyers are expected this spring, which is typically the busiest season in real estate. And, according to Realtor.com, if you're a seller, you should prepare:
“If homeowners are planning to sell in 2023, now is the time to get ready.”
Working with a local real estate agent to maximize your home's appeal and get it listed at the best price for your area is what this entails.
The housing market is heating up in preparation for spring. If you're considering selling your home and taking advantage of the recent increase in buyer activity, work with a local real estate agent.
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