KANSAS CITY, Mo. — With inflation potentially pushing up interest rates, the housing market is falling under a harsher spotlight.
KSHB 41 News spoke with an economics expert on what to know about the current home-buying climate.
"If you can find an opportunity now, it's the time to go for it because mortgage rates are only going to go up in the future," said Dr. Erik Olsen, the chair of the University of Missouri - Kansas City's economics department.
There is a catch - prices in the current market are up, way up.
"Real estate markets have a tendency to get overheated at various times ... I think this is one of those times where the markets are overheated," Olsen said.
According to the Kansas City Regional Association of Realtors, the market is currently dealing with not just higher prices, but less sales and less inventory.
In Jackson County last month, sales were down 6.1% from last year, the average sales price was up 4.5% and inventory was down 25.8%.
Those trends hold in Wyandotte County (sales down 6.5%, average sales price up 13.4%, inventory down 26.6%) and Johnson County (sales down 14%, average sales price up 11.5%, inventory down 26.7%).
It’s also a difficult climate for younger buyers.
"There's a lot of demands on purchasers right now, on people at the demographic that would be entering the housing market, looking to...get on the first rung on the housing ladder," Olsen said.
Olsen did outline one positive to the current home-buying climate.
"The labor market is actually really good right now, which provides ... an opportunity for people who are looking to finance long-term purchases."
Olsen told KSHB 41 News that even in unprecedented economic times, he expects the housing market to calm down.
"We're more likely to see a correction rather than a collapse," he said.
When that correction happens, remains to be seen.
