Buffalo, NY (WBEN) Even though interest rates are going up, the hot housing market hasn't reached its peak yet according to local realtors surveyed by WBEN. One financial expert predicts it could all peak sometime later this year.
Joel HusVar of the Buffalo Niagara Association of Realtors says he's not ready to say the market is peaking. "We are seeing that people are getting into homes, but we're also still seeing multiple offers on majority of our listings," says HusVar. He says while each listing isn't getting 20 or 30 offers, there are still 6 to 8 offers on a house.
While the number of offers per home isn't as high, Husvar says demand is changing. "We are also getting into our spring market, which historically does increase during this time. People are getting their tax returns back and they do have a little bit more money in their accounts. And they're thinking now's the time to buy a house," explains HusVar.
HusVar notes the interest rate increase is affecting the markets. "If you're up a full percent, or if you're up 2 percent, you are buying a different house than you're able to before. But the good news is, you know, the the people are still able to get home," says HusVar. He notes there is a net zero situation with inventory, as one house goes up, it soon is sold.
While demand remains high, Greg Merkel of FSC Securities says we're closing in on the peak of the housing market. "The Federal Reserve is going to probably raise the interest rate a half a point in June and July. And that certainly can bring the 10 year Treasury up a little bit over three percent again. And that's what mortgage rates are based on. So it's certainly going to slow down demand a little bit," says Merkel. He believes demand will slow down near the end of this year.
Merkel notes as interest rates go up, it will cost you more to buy a house. "But again, the housing market still strong. And we know we have a low supply in the Western New York area," says Merkel. That's why he believes the market won't cool until the end of the year.
Merkel says as interest rates go up, it will be a tough ride for homebuyers.
