SAINT LOUIS, MO (KMOX) - With the Federal Reserve raising its benchmark interest rates in recent months, mortgage rates are now hovering near six percent, but that isn't cooling down the hot housing market -- at least not yet.
Normally when interest rates rise, according to Coldwell Banker Gundaker President Jim Dohr, you'll see homes lingering on the market longer, a drop in demand and prices flattening. But he says, that hasn't been the case so far this year.
"We've seen inventory actually decline, which is totally counterintuitive to what has happened historically," he said. "And we're seeing properties sell quickly -- not in every case of course -- but we still see multiple contract situations, prices selling over list price, that's still happening."
Dohr says the rising rates will chase some -- especially first time buyers -- out of the market. For others, he says, they'll have to lower their expectations, "Someone who purchased a home at 3 percent, if they purchased a $450,000 back in December, the same mortgage payment at 6 percent would only allow them to buy a $316,000 house today." And some who may have considered selling won't, because the rate on their new home will be much higher than what they're paying now.
@2022 Audacy (KMOX). All rights reserved.