Braemar Patio Quarterly: January-March 2022 (1st Quarter)
Are rising interest rates affecting the Braemar real estate market? In this edition of the Braemar Patio Quarterly we look back at the quad style, two level townhouse sales in our neighborhood and see the activity for the first quarter of the year. In the first quarter, mortgage interest rates have gone from slightly over 3% to nearly 4.5%. And yesterday, in looking up the thirty year fixed interest rate, my jaw dropped to see it at just under 5.5%.
In the first three months of the year, during this time of rapid mortgage interest rate increase, there were two Braemar Patio homes that sold. Details are listed below.
Two things pop out at this Braemar Real Estate Estate right away. The first sale on Correen Hills sold below list price. That is the first time a Braemar Patio home has sold below list price in the last twelve months. The second thing I notice is that the sale on Gartney, while selling above list price, provided enough seller subsidy to cover all the buyer’s closing costs at just about 3% of the sales price. When you take that $13,000 in seller subsidy from the sales price, you get a seller net sold price of $327,000. Hard to really qualify that as a sale above list price when the seller was a net loss from list price. At a glance, it seems the mortgage rate increase may be changing the market.
When we take these first quarter sales and combine them with the last three quarters of 2021, the entire past twelve months of Braemar Patio home sales is parsed out into six and twelve month data points. These data point show us the market trends to date. Let’s take a look.
Starting in the sold price column, there is positive growth in both six month values compared to the twelve month values. This indicates more steady increase in Braemar Patio homes. Time will tell us how continued interest rate hikes affect values.
When it comes to seller subsidy, this is where we learn how much closing cost help buyers were able to negotiate from their Braemar Patio home sellers. With that whopping $13,000 on the books in one of two of the most recent sales, it is no surprise to see the six month average topping the twelve month average seller subsidy. Better news for now, is that the six and twelve month median seller subsidy values are at zero. That means more than half of Braemar Patio home sellers in both time frames gave nothing in closing cost help.
Days on market has increased on average when we look at the six month marketing time compared to the twelve month marketing time. The median values for six and twelve months is the same at five days. Better news here is that the most recent sales fall in line with those shorter median marketing times.
If you placed your Braemar Patio home on the market, priced to current conditions, you could still expect high buyer demand. As more buyers compete for limited inventory, your Patio home is likely to be under contract in five days or less. However, as interest rates increase, you may find yourself in a position to give some seller subsidy to help a buyer. The way to avoid that is to have a skilled negotiator on your side. Listing agents that can create buyer enthusiasm through expert preparation advice and professional marketing create that multiple offer situation where buyers must put their best foot forward to win your listing.
The next Braemar Patio Quarterly will be out in July. Between now and then we do expect demand for housing will continue to be strong, despite rising interest rates. If the time is nearing for you to sell, don’t rely on market conditions alone for the best outcome. Get in touch with me for a confidential market analysis and find out how my sellers are continually on top of the market, no matter the conditions. Since 2005, No One Knows Braemar Better!