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1. Low home inventory: Active listings are few and far between, compared to demand. At the end of 2021, the inventory of unsold existing homes dropped to 860,000, a record low, according to the National Association of Realtors. At the time I wrote this article, there were only eight homes for sale and that's a very low inventory for Solera. 2. Contracts with no appraisal contingency: All-cash buyers' offers are generally not contingent on an appraisal in this market. We are even seeing non-cash buyers willing to remove the appraisal contingent so that their offer is more likely to get accepted. Often that means that the home is selling for more than the appraised value. Thus, prices keep going up. 3. Some sellers feel 'stuck': The lack of housing inventory also impacts homeowners who want to sell but don't feel confident they can afford to make their next purchase in today's ultra-competitive market. "The market has gotten so intense that if you can't make an all- cash offer or afford to waive inspections, you simply can't compete with people who have those resources. For the average American, selling your home is usually a prerequisite for buying a new one, but the pressure of today's market leaves less time to take advantage of that option for many people. 4. Homeowners are tapping their equity and staying put: The benefits of low interest rates and rising property values throughout the pandemic spurred homeowners to take advantage of their home equities through cash-out refinances - in other words, replacing an old mortgage with a new, higher balance loan. The difference is then doled out to the borrower in cash, which can be used to consolidate debt, or pay for home renovation projects or other big-ticket expenses. In late 2021, the number of cash-out refinances soared by 33 percent from the previous year, according to a mortgage report released by Black Knight, a financial services company. If homeowners are "banking" on their home while living in it, that could explain why they're less likely to sell. 5. Rising interest rates: Due to rising inflation and the Federal Reserve's decision to increase interest rates, the average fixed rate on a 30-year mortgage just surpassed four percent for the first time since the pandemic began. Some economists believe this could continue to drive up home prices. "Short-term pressure from rising mortgage rates means that many buyers are feeling a sense of urgency to buy now instead of waiting, which is exacerbating competitive conditions, pushing prices up higher and keeping homes selling quickly," said Realtor.com's Chief Economist Danielle Hale. (Sources: Association of Realtors, Realtor.com) 5 Reasons Behind Housing Price Rise | LIFE IN SOLERA | MAY 2022 | 11 By Diana Mangan Realtor and Resident

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