The president of the Iowa Association of Realtors says the record-setting housing market has slowed some — but it is far from hitting a full stop.
Byron Menke of Treynor says the nearly eight percent drop in home sales in May was the signal of a slowdown that he says was not unexpected. “The demand is still extremely high, a lot of buyers still out there, you know, inventory continues to be short. And so that just kind of tempering this market a little bit,” Menke says. Menke says it has helped make things a little more manageable.
“It’s slowed. I mean, I’m not gonna say that it hasn’t slowed. But it’s I’ve told people I feel like it would be kind of common to say, instead of doing 100 miles an hour on the freeway, we’re getting close to doing the speed limit again here,” according to Menke. The median sale price in May was up nearly 13 percent — showing the impact of the high demand, and low supply.
“You never want to see the market slow up and sell fewer homes were in the market to sell. But I think it was something that, you know, probably needed to happen, it was the market had gotten so fast and furious,” Menke says, “and it was extremely hard for a lot of buyers to even, you know, get into the market, just because a lot of the cash buyers just came in and sucked things up. If they weren’t cash buyers, you know, the beginning buyer, it made it extremely hard for them.”
He says some buyers have kind of stepped off to the sidelines for now. “Interest rates have doubled since the beginning of the year. And I know that’s got some people, looking hard, you know, what do we do now. You know, do we come in,?” he says. “I think you’re starting to see people go back to things that we haven’t heard of for a while adjustable-rate mortgages, those type of things.”
Menke says there are still people out looking for homes and with the inventory still tight — it will remain a very competitive market for those looking to buy. He says interest rates will continue to be a brake for some.
“It’s going to I think continue to slow things down. It’s just anytime you have that much of a jump of interest rates and with the outlook of more interest rate increases coming,” he says. Menke says there’s always people relocating and he doesn’t see things completely slowing down right now.