I hope your summer is spectacular so far!
Here is the latest on the Real Estate Market for the OKC Area. This month we will look at the following questions:
• Are the higher interest rates affecting home prices?
• Why is List-to-sale-price Ratio important for Home Buyers to understand?
• How fast are homes selling right now?
• Will interest rates get lower anytime soon?
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Video Transcript:
Welcome to this month's real estate market update. You know, a question that I'm asked quite frequently right now is, "are the higher interest rates affecting pricing?" - so let's jump in on pricing. Right now, the average price per square foot is up across all markets. Oklahoma City at $161 per square foot - that's up 2% year-over-year. In Edmond it's at $185 per square foot - that's also up 2%. In the Yukon / Mustang area the average price per square foot is $163, which is up 4% year-over-year. The average sales price is also up across all markets - $300,000 in Oklahoma City, $447,000 in Edmond and $300,000 in Yukon Mustang areas.
In sold price versus list price we're seeing a 1% negotiating margin. This is always a number that I encourage people to learn about when they first start shopping for a home. For example at, 400,000 - a 1% negotiating margin means that, on average, sellers are only coming off their price by $4,000 - - so if you're budgeted to 400,000, but you're looking at $425,000 it's not like you're going to be able to negotiate that down $25,000 when average on Market you're only seeing about a 1% negotiating margin. These are important numbers to understand when you first start home shopping and setting your budget as far as which houses we look at. A big mistake that a buyer can make is looking at houses that are more expensive early on getting spoiled to the features and amenities in those houses and then, feeling like they have to compromise whenever they come back to their actual budget later in the process.
As we look at inventory and days on Market both of these numbers are relatively unchanged from last month. We're at a 2.7 month supply across the Oklahoma City metro area in terms of inventory and the average days on Market is 32 days.
Now let's look at interest rates. The results of the June 12 fed meeting left rates unchanged. Keep in mind the FED doesn't set interest rates for loans - they set the federal standard rate and so that part stayed unchanged. Interest rates can be affected by jobs data, it can be affected by world political events - all kinds of things - the stock market - all of those kinds of things, but what we're seeing now is less likelihood of rates changing very much through the rest of this year. Early on we thought there may be three rate changes even from the FED over the course of this year and now that's not looking like that's going to be the case - so I don't know that we'll see much change in rates. Right now, according to bankrate.com, the average interest rate is in the range of 7% to 7.1%. The main thing to keep in mind with interest rates is that more than ever before it's all sensitive to to your qualifying ratios your debt to income ratio your credit score things like that so if you're looking for that best rate in town - definitely shop around but definitely take care of your qualifying terms as far as how you look as a borrower.
Thanks as always for tuning in and join us next time as we take the market and break it down.