Mortgage rates are still hovering around record lows, but that isn’t making buying a home cheaper for many people any longer.
“Low mortgage rates remain a potent fuel, driving demand and keeping purchasing activity rolling,” said George Ratiu, senior economist at Realtor.com. “However, fast-shrinking inventory and aggressive price gains are combining to outrun buyers’ ability to afford a home as we head into the cooler season.”
When rates drop, affordability improves for a period of time. But as history has shown, low rates eventually coax more people into the housing market. That creates competition for homes, which drives prices upward.
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