Greetings:
AS MORTGAGE RATES NEAR A 23 YEAR HIGH, IS THERE ANY HOPE?
According to Curt Sandfort, from GoPrime Mortgage in Roseburg, “rising rates are particularly aggressive because the Feds are trying to catch up!” He went on to say, “The Fed Fund Rate doesn’t dictate mortgage rates, but in general, tighter Fed policies put pressure on rates across the Board. Mortgages are not immune.” Nationwide, the average mortgage rate for home loans is close to 7% and it seems high compared to 2 years ago when it was under 3%. However, most of us knew those rates were not sustainable.
In our local market, rates are very erratic and fluctuate depending on the lender. It can mean a difference of 25-50 bases points. My advice to buyers is to shop around when it comes to choosing a lender. Buyers can also ask the seller to contribute towards closing costs and prepaids to help purchase their dream home. Last month, one of our sellers contributed $10,000 to help the buyer purchase their home. It helps to be creative when putting sales together to see more people achieve homeownership.
Of course, we have all heard that the inventory is extremely low, and the market continues to favor sellers. In a normal market, there are 25-30 houses on the market for every 1,000 at any given time. However, in our market that number is more like 14, so buyers have less to choose from. Another factor that plays into the shortage of houses for sale is people choosing to stay in their current home instead of purchasing their “step-up” or “downsize” home. In fact, I often hear in our community, “We would sell our house, but we have no place to go!” Thus, contributing to the tight inventory.
In our local real estate market, comparing the month of July, the average sales price has decreased (-5.8%) from $371,500 in 2022 to $350,100 in 2023. In the same comparison, the median sales price has decreased (-2.2%) from $327,000 to $319,900. As we compared June 2023 to July 2023 home values have decreased from $373,900 to $350,100 (-6.4%).
New listings for the month of July were 179, which is down from 186 in June of 2023. Year-to-date new listings are 1088, which is down by (-17.1%) from last year at 1,312. Currently, there is a 2.9-month supply of listings on the market to sell, which is the same as last month. Our inventory continues to be a challenge for most buyers. We are still seeing multiple offers on certain priced properties. There were 34 houses sold last month in both the $200,000 to $300,000 price range and the $300,000 to $400,000 price range. There was one house sold in the $1 MM to 2+MM. The market for properties over $1MM has dropped off significantly.
Our closed sales decreased (-5.95%) in July 2023 to 127 compared to June 2023 at 135. Also, year-to-date closed sales decreased (-20.2%) to 770 in 2023 compared to 965 in 2022. One interesting stat is out of the 10 areas that report closed sales, 7 saw a decrease in average sales price. including NE Roseburg, SE Roseburg, Glide, Sutherlin/Oakland, Winston, Myrtle Creek, and N. Douglas County. The areas that did not see a drop in average sales price were SW Roseburg, NW Roseburg, and Green.
Please keep all the men and women that are serving in the military, health care workers, and our first responders along with their families in your thoughts and prayers.
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