Home sales in February 2018 outpaced expectations as the housing market revs up for its spring season, but limited inventory, especially on the more affordable end of the price spectrum, held back sales.
National Association of Realtors' chief economist Lawrence Yun is distressed at one trend emerging from today's market, "the interest rate lock effect." CNBC reports that sellers aren't wanting to move and lose the lower mortgage rate they currently have. "That said, higher rates are spurring buyers to lock in a purchase and a funding rate before [rates] head even higher," says Peter Boockvar, chief investment officer at Bleakley Advisory Group.
Homes sales in the West, where prices are highest, jumped more than 11 percent for the month, and the higher end of the market was very active. Nationally, sales of homes priced above $750,000 were up nearly 19 percent from a year ago. New tax laws limit the mortgage interest deduction. Borrowers can now deduct interest paid on up to $750,000 in mortgage debt. Previously, the limit was $1 million in mortgage debt.
