Misery loves company and this market is just too competitive, overvalued, and nearly impossible to find something. As times goes on interest rates keep rising and I’m getting priced out. Everyone keeps telling me home prices are not going to come down and they will keep going up as interest rates rise. I can tell you I can’t afford a home anymore with the rise in interest rates and home prices still continuing to climb. How is everyone especially with higher interest rates and high home prices able to afford it? Is everyone just wealthier or is everyone just going to deal with the higher payments and be reassured there won’t be a housing price drop?
I know in the stock market the rises comes with a fall. Is everyone’s opinion this home price rocket ship is forever soaring with no return in sight?
Leaving this open to thoughts, ideas, and encouragement to anyone else in similar positions. I’m trying to buy a home in Texas if anyone is curious.
UPDATE***
Thank you everyone for your answers, comments, discussions, and insights. I had no idea this would elicit this many comments and up votes. I hope anyone visiting this subreddit in a similar position is able to take advantage of the wealth of knowledge shared. I’m sorry if I did not respond to everyone’s questions it is difficult to keep up.
Just to summarize the collective answer to my question:
Yes, there are some that have given up for this year and maybe next and have the advantage to wait because they don’t need extra space, will keep renting, or aren’t looking to take the financial risk in the near term.
Sort of, there are some that have stopped actively searching and looking at opportunities when they arise but moving on to other important things in their lives.
No, these buyers are still in the market and need to buy because they moved, need more space, don’t want to rent, feel that it’s going to get more expensive, want to lock in a lower rate now than later, or don’t expect prices to go down.
Summary of marcoeconomic views:
Rates rising will cut back some demand in the market
Rates rising does not mean home prices will lower because SUPPLY is the main issue. Inventory levels of homes versus demand is such a wide gap. When rates go up and supply is still low mortgages are going to be expensive.
Supply is low because of supply chain issues for builders to build fast (labor and material shortages), many new homeowners won’t move because they have locked in low interest rates, existing homeowners want to move but don’t know where they would go because of how expensive prices are.
As the year goes on if the Fed keeps raising rates and the supply to demand gap is closed then possibly you can see a normalization in the market. Means reasonable evaluations on home prices.
One way to increase supply is for home builder back logs to be expedited once supply chain and labor issues resolve meaning quicker build times and more spec home inventory. This is the biggest headwind to the sellers market. Keep an eye out for this.
Predictions for how long it will take supply chain and labor issues to resolve and the bottle necks to widen is anyone’s guess. The consensus is that “we don’t know.”
Something has to give, inflation is high, rates need to be raised hawkishly, current supply priced advantage may be at risk once builder spec inventories ramp up.
Feel free to keep commenting! Thanks to all who responded!