--- title: Why Seasonality Doesn't Matter in the Housing Market This Spring description: The housing market is typically impacted by seasonal trends. But mortgage rates are now often the biggest factor for home sales and pricing. authors: - name: Brenden Rearick role: Reporter url: https://money.com/author/brenden-rearick/ bio: Brenden Rearick is a former reporter at Money who specialized in covering breaking news and enterprise stories about credit cards, real estate, investing, and personal finance trends. education: University of Pittsburgh, BA at_money_since: 2023 articles: 133 covers: - Mortgages - Banking - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Housing - Insurance - Investing - Lifestyle - Loans - Personal Finance - Professional Services - Retirement - Shopping - Taxes - Technology former_staff: true editors: - name: Brad Tuttle role: Senior Editor url: https://money.com/author/brad-tuttle/ bio: Brad Tuttle is a former senior editor at Money with over 10 years’ experience covering a vast number of personal finance topics, including careers, cars, travel, budgeting, investing, insurance, credit cards, consumer psychology, real estate, banking, and shopping and deals. education: Columbia University School of Journalism, MS at_money_since: 2014 articles: 366 covers: - Mortgages - Banking - Business - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Personal Finance - Pets - Professional Services - Retirement - Shopping - Taxes - Technology social: - https://twitter.com/bradrtuttle - https://linkedin.com/in/brad-tuttle-834b225 former_staff: true published: '2023-03-31T18:35:45.000Z' modified: '2024-01-10T14:40:43.000Z' section: Mortgages tags: - News word_count: 547 canonical: https://money.com/mortgage-rates-affect-housing-market-seasonality/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We may earn a fee if you click on the links below. Compensation does not determine ranking. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Collage of Houses, calendar, and hand golding a key](https://img.money.com/2023/03/News-Mortgage-Rates-1.jpg) The housing market usually has seasonal ebbs and flows. [Spring](https://money.com/spring-home-buying-outlook-2023/) is historically a very strong season for the real estate market, and home sales tend to peak during the warmest months of summer. But now, with [interest rate hikes](https://money.com/fed-interest-rate-hike-march-2023/) continuing to affect the terms [mortgage lenders](https://money.com/best-mortgage-lenders/) are offering to homebuyers, seasonality might not hold nearly the same influence on real estate. Rather, it looks like the market in 2023 could be all about [mortgage rates](https://money.com/current-mortgage-rates/). ## Housing market bucks seasonality trends Spring is normally the start of the busiest time of the year for home sales. However, there have been fewer closings than usual so far in 2023, even as the historically-active season kicks off. "We’re not seeing the typical spring seasonal increase in business," Redfin agent Shauna Pendleton said in a [news release](https://www.redfin.com/news/housing-market-update-new-listings-mortgage-rates-decline/). The real estate market is morphing. The Federal Reserve’s interest rate hikes have had a depressing effect on the housing market. When the central bank hikes rates, it becomes more expensive to borrow money. This ripples across to variable-rate loans like [credit cards](https://money.com/best-credit-cards/) and mortgages, pushing these rates up in turn. The rate hikes are indirectly causing the market to shirk its typical seasonal trends. As the Fed [softens ever so slightly](https://www.cnbc.com/2023/03/10/just-like-that-market-pricing-swings-back-to-quarter-point-fed-rate-hike.html) on its most recent rate hike, mortgage rates seem like the new end all, be all for the housing market in 2023. "There’s no seasonality," Pendleton said. "Homebuyers and sellers are hyper-focused on mortgage rates." ## It’s all about the mortgages When the Fed announced its [most recent rate hike](https://money.com/fed-interest-rate-hike-march-2023/), the central bank signaled that it could be [finis](https://money.com/will-fed-cut-interest-rates-soon/)[hing](https://money.com/will-fed-cut-interest-rates-soon/) [its](https://money.com/will-fed-cut-interest-rates-soon/) [rate](https://money.com/will-fed-cut-interest-rates-soon/) [hikes](https://money.com/will-fed-cut-interest-rates-soon/) earlier than expected. The news wound up pushing mortgage rates down at the end of March, in turn [bringing up mortgage demand](https://www.cnbc.com/2023/03/29/mortgage-demand-increased-last-week.html) by 2.9%. This continues a trend we've witnessed [throughout the first quarter](https://www.cnbc.com/2023/01/18/mortgage-demand-jumps-interest-rates-drop.html) of 2023. Basically, whenever mortgage rates dip, more buyers seek out mortgages. The flip side is that when mortgage rates creep higher, homebuyers tend to ease off and demand for mortgages declines — regardless of normal seasonal trends in the housing market. Experts predict that the recent increase in mortgage demand will be short-lived. The softened rate hike comes in large part due to the multiple [banking meltdowns](https://money.com/weekly-stock-market-outlook/) that took place in March, and barring any more instability, interest rate hikes will resume their normal trajectory. Low mortgage rates are obviously good for homebuyers. They’re good for sellers, too. Low mortgage rates mean a larger market of potential buyers, and that can lead to more competitive bidding. Moreover, many sellers want to hold onto the low mortgage rates they secured years ago, when rates were much lower than they are nowadays. If they're still paying off their mortgage, they don't want to give up that favorable rate. If mortgage rates continue to stay high or even rise further, many of these potential sellers will opt to stay put. In a [recent poll](https://www.newyorkfed.org/newsevents/news/research/2023/20230328) Americans said they expect mortgage rates to rise from 6.93%, the current average rate for a 30-year fixed-rate mortgage, to over 8% in the next year. If that happens, real estate might be in for a stagnant 2023. ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/mortgage-rates-affect-housing-market-seasonality/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Mortgages", "item": "https://money.com/mortgages/" }, { "@type": "ListItem", "position": 3, "name": "Mortgage Rates", "item": "https://money.com/mortgage-rates/" }, { "@type": "ListItem", "position": 4, "name": "Why Seasonality Doesn't Matter in the Housing Market This Spring" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/mortgage-rates-affect-housing-market-seasonality/#webpage", "url": "https://money.com/mortgage-rates-affect-housing-market-seasonality/", "name": "Why Seasonality Doesn't Matter in the Housing Market This Spring", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2023-03-31T18:35:45.000Z", "mainEntity": { "@id": "https://money.com/mortgage-rates-affect-housing-market-seasonality/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/mortgage-rates-affect-housing-market-seasonality/#breadcrumb" }, "dateModified": "2024-01-10T14:40:43.000Z" }, { "@type": "NewsArticle", "headline": "Why Seasonality Doesn't Matter in the Housing Market This Spring", "articleSection": "Mortgages", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/03/News-Mortgage-Rates-1.jpg", "width": 2880, "height": 1920, "caption": "News-Mortgage-Rates" } ], "author": [ { "@type": "Person", "name": "Brenden Rearick", "url": "https://money.com/author/brenden-rearick/", "@id": "https://money.com/author/brenden-rearick/#author", "description": "Brenden Rearick is a former reporter at Money who specialized in covering breaking news and enterprise stories about credit cards, real estate, investing, and personal finance trends.\r\n\r\n", "email": "brenden.rearick@money.com", "alumniOf": "University of Pittsburgh, BA" } ], "publisher": "https://money.com/#organization", "datePublished": "2023-03-31T18:35:45.000Z", "description": "The housing market is typically impacted by seasonal trends. But mortgage rates are now often the biggest factor for home sales and pricing.", "abstract": "The housing market is typically impacted by seasonal trends. But mortgage rates are now often the biggest factor for home sales and pricing.", "@id": "https://money.com/mortgage-rates-affect-housing-market-seasonality/", "inLanguage": "en-US", "dateModified": "2024-01-10T14:40:43.000Z", "editor": [ { "@type": "Person", "name": "Brad Tuttle", "url": "https://money.com/author/brad-tuttle/", "@id": "https://money.com/author/brad-tuttle/#author", "description": "Brad Tuttle is a former senior editor at Money with over 10 years’ experience covering a vast number of personal finance topics, including careers, cars, travel, budgeting, investing, insurance, credit cards, consumer psychology, real estate, banking, and shopping and deals.\r\n\r\n", "image": "https://img.money.com/2014/01/Brad-Tuttle.png?w=226&h=247&crop=1", "alumniOf": "Columbia University School of Journalism, MS", "sameAs": [ "https://twitter.com/bradrtuttle", "https://linkedin.com/in/brad-tuttle-834b225" ] } ], "wordCount": 547, "keywords": [ "News" ], "about": [ { "@type": "Thing", "name": "Mortgage", "sameAs": [ "https://en.wikipedia.org/wiki/Mortgage" ] } ] } ] } ```