Today's top story:   The 30-year fixed mortgage rate topped 6% for first time in 14 years!

Hi everybody, Joe Hillner with Your Home Sold Guaranteed Realty, where we guarantee the sale of your home or I'll buy it! 

Ok, so every week, I share market data to keep you informed with the local real estate market.  

Here is this week’s Boca Market Watch.

First, Single Family Homes:

This past week, 63 new listings, not bad, and ranging in price from $389K to $8.9M!  15 homes back on the market, while 75 homes listed took a price decrease, holy cow that's a bunch, and 2 sellers raised their asking price.  And like the the last couple of weeks, only 38 different properties under contract, and 23 going pending, just terrible! 30 homes were unsuccessful in selling and were taken off the market or the listing expired outright.  And a bad week for sales with 45 homes sold, ranging from $333K to $9.1M!

Next up, Condos and Townhomes:

69 new listings, not too bad,  and ranging from $160 Grand to $5.6 Million.  13 units came back on the market, 64 properties with a price decrease,  like last week that's a lot, and 2 sellers with an increase.  And another poor week with 42 different properties under contract, and 26 going pending,  And 18 condos or townhomes were unsuccessful in selling and were taken off the market or the listing expired. 54 closed sales this week, not great, and ranging in price from $120K to $1.2M.

Here's what's making news right now.

According to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey, the 30-year fixed-mortgage rate topped 6% for the first time since 2008.That's a major milestone and now that we've topped that ceiling, it's likely that the Fed's next rate hike of another 75 basis points will push mortgage rates even higher.

Higher mortgage rates have pushed refinance activity down more than 80% from last year and have contributed to more homebuyers staying on the sidelines.  Many buyers were simply priced out of the market due to the higher prices and higher mortgage rates.   Others are simply waiting on the sidelines for the market correction that may, or may not, come.

What they don't understand is the math, which is not too difficult.  To keep it simple, let's take a basic $400,000 loan amount and assume that prices could come down 5 % over the long term and rates go up another 2% in the interim, or conversely that prices hold steady and rates go up 1% in the short term.  In the first scenario, the monthly payment on $380,000, which is a 5% decrease, is $2788 a month.  Contrast that with a $2661 payment for $400,000 at 7%, same price but a 1% rate increase, $127 a month less, plus you buy soon and get the tax advantages.  

And if one moves fast and secures a 6% rate, that payment is only $2398 a month, or $390 less!  As you can see, it's the rates that make all the difference, not the price - that's the power of leverage.  So if you know anyone looking to buy, make sure that they understand that critical concept.

And if you're looking to buy, consider this.  The absolute best time to buy is over the next month or so.  Kids are back in school so most families have made their decisions and are in place, or their plans are on hold.  We are about to go into the high holy days, so many orthodox buyers will not be active in the market.  Consequently, you will have a lot less competition.  And there are more listings hitting the market every day, so you will have more choices. As properties sit on the market longer, you will have time to take a breath and make smart decisions - the days of frenzied, rushed, over asking price offers are behind us now.  So that levels the playing field a little - some welcome news for frustrated buyers!