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Since late-2022, homebuilders have been accelerating sales by offering costly mortgage rate buydowns, often providing 30-year mortgage terms at approximately 4% to 5.5%. Many of the buyers who purchased homes under these conditions would not be able to qualify at current market rates of 7% or even 6%.
Rick Palacios Jr. highlighted these observations in a recent statement.
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Palacios previously reported that Dallas homebuilders saw a 70% decline in sales within H-1B visa buyer communities as rates rose in September, according to recent analyses. He also outlined five key factors driving interest rates higher during a September 17 client webinar. These findings provide additional context to the current strategies used by homebuilders to stimulate demand.