The Fed raised interest rates once again, resulting in the largest one-week jump in mortgage rates for 35 years. The 30-year fixed rate mortgage was at 6%, the highest level since 2008's recession.
However, the market is cooling due to the rapid rise in interest rates. For example, St. Louis saw a drop in pending home sales by nearly 10% in May compared to the same period last year.
People who are able to afford a home will see their prices rise, according to Zonda, a real-estate research company that provided this information to Fortune.
Some markets in the country are seeing their home prices drop.
Cheryl Leslie is house hunting near Fort Worth, Texas. She hopes to see the prices drop so that she can be closer to her grandkids.
She told CBS News' Kris Van Cleave, "I'm looking now so I can know exactly what I need and want, and where I should go,"
The number of mortgage applications is down by more than 15% in comparison to 2021 and dropped 5% in May.
According to Redfin, nearly one in five people will drop their prices due to the slowing housing sector.
"The housing market is currently in a downturn. It's cyclical and it just can't support the amount of employees we had previously," Daryl Fairweather, Chief Economist at Redfin, stated.
Analysts believe this is only the beginning and prices will continue to fall in certain areas.
"We'll see house prices rise here and some price drops in the more affluent markets throughout the country. Mark Zandi (chief economist at Moody's Analytics) said that this is a correction in the event that house prices drop.
Tina Yassin, a Realtor, has been trying for 28 days to sell her Arlington home. Although the home's price dropped, it has not yet been sold.
Tina Yassin, realtor, stated that "This home, I believe, six months ago would have sold." "Would not be on the market for two weeks after."
Yassin stated that the market and the area will determine the level of demand. Prices are stable in Dallas-Fort Worth. However, most realtors advise sellers to not expect bidding wars on homes that require work. Prices have dropped in markets such as Toledo, Ohio and Rochester, New York, and even Chicago, and Los Angeles.
