The Housing Market Is a
Giant Migraine Right Now

By: Emily McCrary-Ruiz-Esparza Buying a home, Selling a home

Let’s start with the bad news. OK, that’s pretty much all we have here anyway.

  • Home prices just saw the biggest spike in four years
  • Inventory continues to be low, with numbers sinking
  • Mortgage rates rise, lending slows, banks try to woo you with mortgage apps

Home prices rise

Home prices rose 8.9% in March over the same time a year ago, according to Redfin, a national real estate brokerage. That’s the biggest jump in four years. We started seeing more significant uptick in January of this year, but the increase hasn’t boosted inventory levels at all, so we can’t tell you when we’ll see some relief. 

At of March 2018, Redfin, lists the national median home sale price at $297,000, Zillow at $228,200.

Inventory continues to be low

You’d think with home prices going up that we’d start to see inventory levels go up as some buyers are disqualified, but no such luck. Redfin reports that in March housing inventory dropped 13.6% over last year the number of new listings is down by 7.3% over last year (this is according to its Housing Demand Index, which benchmarks 15 major metro areas); the lack of new-construction homes isn’t helping. Basically, supply just isn’t meeting demand, so it’s likely that prices will continue to rise as the market stays buyer-crowded.

The low end of the market is seeing the least number of houses, but don’t worry, we’ve just taken on some of the toughest home buying problems (we’re looking at you, first-time buyers) and solved them for you. You’re welcome. Read: When a Home Purchase Goes Awry: The Home Buying Problems We Don’t Talk About

Mortgage rates go up

Rates for 15- and 30-year fixed-rate mortgages just went up and for 5/1 adjustable-rate mortgages as well. The cost to borrow is also as high as its been in four years. Mortgage rates are at their highest point in six years.

Bankrate compared this week’s new rates to the 52-week average:

  • The 15-year fixed-rate mortgage rose to 4.16% from 4.02%.
  • The 5/1 adjustable-rate mortgage rose to 4.10% from 4.03%.
  • The 30-year fixed-rate jumbo mortgage rose to 4.60% from 4.51%.

Mortgage lending slows (plus a little bit of good news)

Because mortgage lending has slowed in 2018 ahead of the summer real estate market, the banks are still going to try to make it as easy as possible for you to get a mortgage.

The big players in the space are investing scores in app development in hopes of locking in the newest wave of everybody-loves-to-hate-em home buyers: Millennials.

A Reuters report from this month indicates that JPMorgan Chase & Co is investing $1.4 billion in tech in 2018 and that Bank of America Corp has already spend $1 billion on digital banking in the last six years. In April, Bank of America rolled out its own line of digital mortgage products.

Mortgage apps are where it’s at, though, it would seem, since Quicken, which owns Rocket Mortgage, was the largest home lender by volume in Q4 of 2017 and in Q1 of 2018, and the second largest overall in 2017. Quicken reports that 98% of the first-quarter lending volume accessed their Rocket Mortgage app at some point in the lending process.

More in Real Estate

Row of traditional suburban homes and front lawns in nice neighborhood
Real Estate

Ready To Pay Off Your Mortgage? Here Are 7 Ways to Speed Up The Process

Paying off your mortgage early boils down to paying more toward the principal as soon as you can. Refinancing to a shorter term can speed the process and you’ll know exactly when you’ll be paid up. Or you can use the more flexible, informal method of paying more toward the principal more monthly or annually.

Read More
Real Estate

5 Strategies for Getting in the Financial Position to Buy a House

Are you ready to become a first-time homebuyer? In this article, House Method explains five simple tips for getting in the financial position to buy a house.

Read More
Outdoor Living

5 Most Common Problems for Homeowners with Pools

Owning a pool is great. From pool parties to just cooling off with your family. But owning a pool can be hard. Read about the most common problems homeowners with pools face.

Read More
Real Estate

7 Mistakes Homeowners Make When Listing to Sell

The real estate pros talk about the most common mistakes sellers make when listing their homes—and how you can avoid them.

Read More
Real Estate

What to Expect in 2019 Real Estate

Residential real estate in 2019 will echo loudly of the previous year, but advantage will begin to shift in buyers' favor for the first time in a while. Here’s what you need to know.

Read More
Real Estate

13 Unique Ways to Find a New Apartment

Different ways to find new listings and gain an edge in your new apartment search. And no, we’re not going to suggest checking Craigslist or Zillow.

Read More
Real Estate

What to Know About Paying Off Your Mortgage Early

A few things to consider about what mortgage prepayment means for your finances and liquidity.

Read More
Real Estate

Listing Your House at the Holidays? Why You May Have the Upper Hand

Sellers gain the advantage during two off-season sweet spots. Why listing your home at the holidays could mean a swift close and an easy transaction.

Read More
Real Estate

Home Sale Prices Have Hit a High. Is Now the Right Time to Buy?

Housing prices in the United States hit an all-time high in June, according to the National Association of Realtors. There are signs high home prices are leveling off, but buying a house is still really expensive. In what might be the hottest of all seller's markets, what is a buyer to do?

Read More

What Did You Think?

Join the Conversation

By continuing to browse or by clicking “OK” you agree to the storing of first- and third-party cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. Privacy Policy.