According to data from Freddie Mac, the average rate for a 30-year fixed-rate mortgage reached 7.57% in the week ending October 12th, up from 7.49% the previous week. This marks the highest level in 23 years.

Experts express concerns about the upward trend in mortgage rates, anticipating a further increase that could exacerbate the downturn in the real estate market. Some economists even predict that if the Federal Reserve raises rates again, mortgage rates for this year are likely to surpass the 8% threshold.

This high-interest rate environment has maintained a stable phase in the real estate market for several months. While last year the real estate market was losing momentum, this year, although not yet reaching the peak rate, it has entered a phase of stable lower sales activity.

Meanwhile, the Federal Reserve is grappling with the challenge of addressing inflation. The latest Consumer Price Index reveals a year-on-year inflation rate of 3.7% in September, unchanged from August.

As a result, attention is focused on the upcoming Federal Reserve meeting, with expectations that if the Federal Reserve decides to raise rates again, mortgage rates could further rise to the 8% level.

High house prices are also a significant issue in the current real estate market. While the median house price has seen slight growth in the past week, there has been minimal fluctuation over the past few months.

Prospective buyers, waiting for a drop in mortgage interest rates, are adopting a wait-and-see approach, leading to the expectation that house prices will remain at similar levels to last year in the foreseeable future.

Another factor affecting the real estate market is the low housing inventory. The number of newly listed houses continues to decline, contributing to an overall decrease in inventory. Many homeowners, buoyed by existing low rates, are choosing not to move, leading to a tight inventory situation. With limited housing options available, house prices are rising, and buyers are still eager to find affordably priced houses.

Despite the challenge of decreased economic resilience, some eager buyers are searching for suitable homes in a low-inventory market. Thus, while the pace of house sales has slowed, there is still a certain level of activity.