Comparing October of 2022 to October of 2021 | 11/9/22

October brought no “trick or treating” and gave us some similar statistics as previous months. However, with interest rates posted on the internet for Vermont of 7.85% for a 30-year fixed rate with 20% down, there are no treats in the housing market. We have seen a slow-down of properties coming on the market and selling, but continue to see an increase in the average sales price year-over-year. It will be interesting to see what statistics November and December bring.

According to Freddie Mac’s Primary Mortgage Market Survey, the US average interest rate for the first week in November was 6.95%. In January of 2022 it was 3.22%. At the end of March of 2022, the rate was 4.67%. Sadly, this has knocked many buyers out of the market and has caused sellers to reconsider the price they ask for when selling. 

Kim Negron, Area Manager and loan officer with Homebridge Financial Services said, "I think we are in for a long winter. I don’t see rates coming down for a bit. I am hopeful that by the second quarter of 2023 we will see some relief and possibly see rates in the 5% range, which will be a welcome change for homeowners who are purchasing now so they can refinance.” She added, “And, it will be really great for those homebuyers who missed out on the lower rates we saw during the pandemic. Rates, however, will always be changing and should never deter a homebuyer from purchasing a home. Waiting for rates is not the answer. You should act if you want to buy, and you can always refinance later on. Remember, if you don’t act now that home you love will not be available by the time you’re ready if you wait on the rates. Not to mention all the equity you will have given up while you wait.” 

In Chittenden County, October of 2022 saw 145 single family homes and condos listed and 176 sold. As a comparison, when the rates were lower in June (5.09% nationally) and traditionally more people were buying and selling, there were 264 homes listed and 228 sold. 

Year-over-year, October of 2021 saw 147 homes listed compared to 145 in 2022. Almost exactly the same. However, 223 homes sold in 2021 compared to the previously mentioned 176 in 2022. So, we are seeing fewer homes sold. 

However, we still saw an increase in the average and median sales price when looking at October of 2021 compared to 2022. The average home sold in 2021 at $438,548 compared to $557,475 in 2022 for a whopping increase of 27%. The median price increased 18.75%. 

What do we think we will see in the coming months?

In the past few years, buyers have waived many contingencies in their offers and have offered significant amounts over asking. I feel this will be a way of the past for at least the time being unless sellers have priced their homes way under the market. As a counter to the high interest rates, I feel we will see sellers crediting money to buyers at closing to “buy down” the interest rate. This means that for two or three years, depending on the buy down program, buyers will pay lower rates until the original rate kicks in. Buyers will hope the interest rates will go down during that period so that they can refinance. 

Predictions are one thing; actual statistics are another. This housing market has surprised us over the past few years. We shall see what November brings.