As home sales cool this fall, what will happen to home prices and interest rates?

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Cash buyers will drop out
Cash buyers will drop out © iStock

Cash buyers will drop out

Real estate investors who snap up properties for the sake of generating rental income may start bowing out of the housing market this fall, Yun says. Why? Because of the disappearance of the foreclosed homes that investors usually are attracted to.

Yun says this change will "provide more opportunities for people who are buying homes for homeownership a better chance at obtaining the home with less competition."

The share of homes purchased by individual investors ticked down from 13% in July to 12% in August, according to the NAR. Individual investors comprise many of the home sales that are paid for in cash, the NAR says.

"As the cash buyers fall, you need mortgage buyers to not only fill the slot but go higher," Mohtashami says.


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