May 27, 2023

As rising mortgage rates dent housing sales, many “Zoom towns” — areas that boomed during the pandemic thanks to an influx of remote workers — are seeing their housing markets cool. That’s leading sellers to get creative and giving buyers a bit of leverage in finding a home.

One new strategy that’s making inroads: The mortgage “buydown,” which can help buyers line up a slightly lower mortgage rate than the 6% or 7% interest on on most home loans today.

Taylor Marr, deputy chief economist at Redfin, explained how this works on CBS News Mornings. In a “2-to-1” buydown, a common arrangement, a buyer can secure a lower rate for the first two years of the loan by putting down additional funds.

“If you’re buying a $500,000 home, you might put an extra $10,000 or $20,000 to temporarily pay down your mortgage rate,” he said. “If you’re getting a 6% mortgage rate, for the first year you actually get 4%. And then it goes up to 5%, then 6%,” he said.

“It can be a great way to afford a home if your income is rising rapidly. But you do have to put more money upfront,” Marr added.

Is now a good time to refinance your mortgage as interest rates begin to decline?


Buydowns are becoming more popular in some areas where home sales are slowing, but they’re just one of several concessions sellers can make to nudge a deal over the line. Other sweeteners could include kicking in some money toward repairs or offering to pay the buyer’s closing costs, Marr said.

In fact, sellers offered a record share of concessions in the last three months of 2022, according to Redfin data. Some 42% of sales by the firm’s agents included a concession, according to a recently published report. Some sellers are also having to drop prices outright, with Marr noting that about half of recent home sales closed below the asking price.

Concessions are most common in the West, Redfin found. Nearly three-quarters of home sales in San Diego had a concession last quarter, followed by Phoenix, Portland, Las Vegas and Denver.

“The pandemic-fueled housing market frenzy was concentrated in a lot of these pandemic boomtowns that were mostly out west,” Marr said. “These are the same markets that have cooled rapidly when [interest] rates rose. They’re increasingly having to come up with concessions to get buyers to be able to buy a home.”

Mortgage rates are nearly double where they where in early 2022 as the Federal Reserve pushes up interest rates in its bid to tame inflation. The run-up has added hundreds of dollars to the typical monthly payment of would-be homebuyers and driven home sales to their lowest level in eight years.

pdf bingo blitz free credits generator v 384594
free coin master spins generator 2023 no human verification s
genshin impact 2 5 announced new characters free primogem
pdf fd443 free instagram followers generator 2023 echa
nintendo eshop gift card code generator no human verification
daily psn code generator no human verification 2022 nvi5q apache
free snapchat score generator 2022 sketchfab
free tinder plus get gold generator 2022 google colab
zepeto free zems and coins zems and coins for zepeto trailblazer me
match masters rewardz apps on google play
free tiktok coins how to get tiktok coins in 2023 pathofex
gems for stumble guys apk download steprimo com
pdf g6s stumble guys mobile hack gems generator free
How To Get 50,000 Tiktok Coins Free (Worldwide) Free Tiktok Coins!
free tiktok likes website 2023 youtube
free unlimited coin master spin generator 2023 opensea
40 free amazon gift card codes followchain
avakin life unlimited avacoin without verification s profile technet
free bingo blitz credits generator generator 2022 txw
unlimited cheat free coin master spins coins
free primogems get primo redeem code if you want hoyolab
free instagram followers generator 2022 instagram followers likes
pdf g5d stumble guys hack unlimited free gems mod apk toluna
Les internautes ont aussi regardé
free tiktok followers 2023 how to get 50000 youtube
pdf coin master free spins 2022 coin master spins
earn free amazon gift cards in 2023 idle empire
how to free avakin life avacoins diamonds generator 2022 no
bingo blitz free credits generator md hugging face
coin master spins generator 2023 63fan

Leave a Reply

Your email address will not be published. Required fields are marked *