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Cleveland Real Estate Update for August 2022

Cleveland Real Estate Update for August 2022

Is it still a good time to sell my house?

Is the real estate market collapsing?

What the heck is going on with interest rates?

Hey Cleveland! I’m Rich Ganim with the Cleveland Home Specialists and Keller Williams Elevate and over the next few minutes, I hope to answer these exact questions for you.

As we enter August we are still in a seller’s market.

The number of homes for sale was up 7.3% from last July and up 21.3% over June of this year.

The number of homes sold was down 16% from last July and down 10.5% compared to June.

The number of homes that went under contract though was up 7.7% compared to June and was up 1.8% compared to last year.

The average price per square foot in Northeast Ohio was down 1.3% compared to June and down 9.4% compared to last year.

The average sales price here in the Cleveland area fell by 4.1% compared to last month too.

So is it still a good time to sell your house? Overall, the answer is YES, it’s still a good time to sell your house. Inventory is still low and there are still a ton of buyers out there looking for a place to call home.

While we saw interest rates jump in June, over the last 7 weeks they’ve actually come back down to the lowest they’ve been since April. At the time of this recording, we saw rates hovering right around the 5% mark.

The question of what is happening with interest rates is one of the most interesting topics we’ve been discussing of late. Mainly, because there is so much misinformation out there.

If you watch the news or read the headlines you’ve heard that the Federal Reserve has raised its interest rates 3/4 of a point recently. There’s a huge misconception here because the Fed raising their rate doesn’t mean that mortgage interest rates are going up.

Mortgage rates follow the 10-year treasury bond. So as their yield goes up and down, so does the 30-year mortgage rate. It actually has nothing to do with what the Federal Reserve does with its interest rates.

So with all that said, is the Cleveland, Ohio real estate market collapsing?

I don’t think it is. What I think we are starting to see if things starting to level out from the wild 2 years we’ve seen since Covid in 2020. Homes are still appreciated and in a lot of price points and neighborhoods, multiple offers are still a thing. What we aren’t seeing though is home values appreciate at 5-10% a month. Pricing should level out the rest of this year and by 2023 we should be returning to a relatively normal market.

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