CORPUS CHRISTI, Texas — On Wednesday, the Federal Reserve announced a third consecutive interest rate hike. The three-quarters of a percentage point increase is a move to slow rising inflation.
The interest rate for a 30-year fixed mortgage hit 6 percent, nearly double what it was this time last year.
“I think people are just uncertain, so they’re pausing,” Marsai Bass, Corpus Christi realtor with RE/MAX said.
Demand has surely slowed from what sellers saw in the last two years. Bass said the low-interest rates drove the demand up.
This is quite the contrast of the current housing market compared to last year.
“It was almost a frenzy," she said. "Multiple offers. You didn’t even have to list a house before you could sell it. Now we’re shifting into a more balanced market.
The rise of federal interest rates could be intimidating to some home buyers.
“We have got to get inflation behind us. I wish there were a painless way to do that. There isn’t,” Jerome Powell said, chairman of the Federal Reserve.
Bass said even though rates are high, people still need to sell their homes. It’s just taking a bit longer.
“With your debt to income ratios that might affect you a little bit, but I’ve seen lenders that are offering to help you with closing costs and things like that," Bass added. "So, maybe you could get into a house.”
She believes Corpus Christi may not be as impacted by the interest rate hike. The city is in a unique situation.
“Exxon, Cheniere, some other companies that are locating, they’re still bringing people. Which means we still need inventory,” she said.
In a unique market, Bass thinks experience benefits a realtor.
She said her company has still seen a steady stream of clients. For now, there's no need to worry about the dip in demand.
“Like I said, you didn’t have to do much to sell a house a couple of years ago, but that’s going to shift," said Bass. "And you’re going to have to have a little more experience and a little more knowledge.”
Prices might not be favorable, but compared to last year, bass said buyers are able to do more negotiating. Sellers were getting what they asked for.
"My advice is to buy a house now, build some equity in it, wait until interest rates drop again, and refinance. And then you've put yourself in a really great financial position," she said.