Welcome to Money Moves. I’m digging into all things money — moves that can impact you, links and insights, and the one thing I can’t get off my mind.
The pandemic’s hot housing market might be showing signs of cooling. Home sales are declining as mortgage rates rise, putting a dent in demand — and many are cheering about it. While that doesn’t sound like something we’d want to see, many homebuyers are hoping it means prices come back down to earth.
Why it matters:
Home prices soared during the pandemic, jumping 32% in two years. In some ways, the increase was a good thing. High home values helped boost the net worth of many Americans. Yet for first-time homebuyers, it was a different story. Steep costs made it more difficult for them to find a place to call home. For some, that may have meant postponing buying a home altogether while others had to adjust budgets and/or expectations.
Some even bought homes, but made regrettable concessions given the highly competitive nature of the market such as buying sight unseen or foregoing inspections.
What it means for you:
There is good news: double digit price increases are likely to moderate. However, the relief might not be as significant as we’d like. Demand for housing is still hot. Interest rates are on the rise. And from millennials entering the market in growing numbers, low levels of inventory, and competition from real-estate investors, supply and demand will remain out of whack. Prices could continue to increase.
If you want to wait for better priced housing just remember that like the stock market, trying to time the housing market is a fool’s errand. Despite where prices go from here, the most important things to consider when buying a home is your personal/family needs, budget and timeline. (We also have a handy calculator that can help guide you.)
I gotta give it to the ladies that hosted the Oscars on Sunday. They brought the gender pay gap to center stage in the opening monologue, with Amy Schumer joking that it was cheaper for the Academy to hire three women to host than one man. Good for them. Way to keep the conversation alive. I know I’ll keep pushing, supporting and cheering for pay parity. I hope you do too.
Check out what else we’re reading this week.
- Crypto turned positive Monday for the first time this year. Read how three experts think about the currency (including me!).
- Would free wings make you feel better about your busted bracket? Ally teamed up with TikTok stars to give back to restaurants as they rebound from the pandemic.
- Florida is the latest state to require personal finance in high school. It’s never too early to start raising money-smart kids.
- Could a recession be on the horizon? Many are on the lookout.
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Lindsey Bell, Ally’s chief markets & money strategist, is an award-winning investment professional with a passion for personal finance and more than 17 years of Wall Street experience. Bell’s unique ability to connect the dots between data and real life and craft bite-sized money ideas that people can use and apply stems from her deep background as an analyst, researcher and portfolio manager at organizations including J.P. Morgan and Deutsche Bank. She is known for demonstrating why and how an understanding of all things money improves a person’s finances and overall well-being. An ongoing CNBC contributor, Bell empowers consumers and investors across all walks of life and frequently shares her insights with the Wall Street Journal, Barron’s, Kiplinger’s, Forbes and Business Insider. She also serves on the board of Better Investing, a non-profit focused on investment education.