"Rising Mortgage Rates Add to Housing Market Woes"

The housing market is facing a challenging situation with high mortgage rates, soaring prices, limited supply, and decreased demand. The popular 30-year fixed mortgage rate has reached 8%, the highest in decades, causing mortgage demand to plummet. The market is also grappling with a severe shortage of housing supply, exacerbated by the Great Recession's impact on homebuilders. Sellers are reluctant to trade their current low mortgage rates for higher ones, while potential buyers are hesitant to enter the market. Sales of previously owned homes have dropped, and the National Association of Realtors has lowered its 2023 sales forecast. However, prices are expected to remain flat despite the shortage. Homebuilders are offering incentives to boost affordability, and certain metropolitan markets with job growth and affordable prices may see an increase in sales. The rental market is cooling off, but demand for rentals is rising. Overall, buyers face a conundrum of purchasing now at higher rates or waiting for rates to drop, potentially leading to bidding wars when demand surges.