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Home prices are not taking the expected break as projected by many of the real estate pundits. It appears that buyers are snatching up 7% mortgages in order to get what they can, even with the limited inventory.

Another metric that is important to follow is the number of individuals purchasing homes without a mortgage; the all-cash buyer is now comprising 40% of the total market, which is a significant increase from the traditional 25%. What is prompting individuals to snatch-up what they can at these levels is the fact that home prices are continuing to rise month-over-month for the last 12 months.

The reports from Redfin actually are calling the 7% mortgage the new normal.

According to past history, high mortgage rates slow market activity and have in the past pulled prices downward. But in 2023 higher mortgage rates are not stopping buyers. And some owners of property have actually elected to keep their present residences or property in the expectation of renting them out while purchasing a new property.

According to recent reports, affordability has become as relevant and important as the inventory shortage.

These are the roadblocks or speedbumps that the 2023 buyer will face:
 ■ High mortgage rates between 7 and 8%
 ■ Inventory shortages
 ■ Higher prices
 ■ Increased competition from other buyers
 ■ More all-cash buyers
 ■ The inability of builders to fill demand for new homes
 ■ Higher building supply costs
 ■ Limited number of buildable lots
 ■ Inflation
■ Disruption to the supply chain

So as Black Knight reported, May prices hit a new record-high, increasing 0.7% above that of April 2023. The current wave of demand has not let up since January of 2023, and it seems that buyers are now getting accustomed to these higher prices.

The increase of 0.7% recorded in May could translate into a month-over-month gain of 8.9% annually. Factoring such a price increase could create a bigger hurdle for first-time buyers and those seniors who are looking to downsize.

If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.

Counsellors Title Agency,, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single-family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.

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