Source: Investopedia —
Chris Donoso and Yefry Rodriguez’s year-long search for their home, a two-family property in Jersey City, N.J., took more than a little patience—and a motivated seller who cut the price by $10,000.
“We got very lucky,” said Donoso, a speech pathologist, and Jersey City native. “The house was under contract with someone else, but their credit fell through and it was right back on the market. So that gave us room to negotiate.”
Granted, concessions are still a rarity, and the couple was able to keep their financing costs low and wait until they got the price they sought.1 The home’s location, in a low- to moderate-income neighborhood, also meant they qualified for a Community Reinvestment Act mortgage, typically about 2 percentage points below the average rate.
Still, their experience underscores a market that’s downshifting from the heady days of the pandemic, according to Rick Sharga, founder of CJ Patrick Company, a real estate advisory firm. Rising mortgage rates have made housing less affordable and slowed sales, and homeowners with low-rate mortgages are reluctant to swap them for rates above 6% unless they’re forced to sell for unforeseen reasons such as a divorce or a job-driven relocation.
“If you’re seeing a property on the market today, you’re probably seeing a motivated seller,” Sharga said. “If you’re a homeowner who doesn’t have to sell, you’re going to wait for conditions to improve.”
