(NewsNation) — Although investors seem optimistic about the current economic outlook, builder confidence has fallen for the eighth straight month as elevated interest rates to cool inflation are driving up the price of homes.
“Well, it is, I guess, bad news for the builders, but it’s good news for people looking to buy to a home,” NewsNation business contributor Lydia Moynihan said.
During the pandemic, there were an estimated 10-15 people putting in bids above asking prices on the same home. But Moynihan said there is finally some relief for buyers, saying there is finally some equilibrium in the housing market where supply is increasing.
The number of people looking to buy homes has also gone down.
The median home price is still increasing, but not nearly as quickly. Last month, 44% of homes had competing offers; but that’s actually down from earlier this year, when 70% of homes on the market had competing offers.
“I think if you are in the market to buy a home, things are finally trending in your direction,” Moynihan said.
Moynihan explained that it’s still a bit tricky for home buyers. While the economy is starting to cool off and there won’t be as many people vying for the same home, interest rates are still going up to combat inflation.
The interest rates are a huge factor that are slowing down the number of people actually looking for homes. Housing prices may continue to come down, but at the same time, consumers could be paying higher rates on mortgages if they continue to wait to buy — especially because the Fed is expected to continue to raise interest rates in the short-term future.