Rates went down a little mortgage applications went up

I think 2023 is going to be an interesting year for the housing market. Interest rates have gone down a little and at the same time

US Mortgage Applications Jump the Most since 2020 Mortgage applications in the US surged 27.9% in the week ended January 13th 2023, the biggest jump since the first week of March 2020, as interest rates dropped to the lowest level since September, data from the Mortgage Bankers Association showed.”

Mortgage rate chart
Mortgage rate survey

The demand for housing remains high. Interest rates will likely go down further but we probably won’t see 3 or 4% again for many years.  Home prices will probably level out a bit but at this point in the Twin Cities, they are still rising.

Asking Artificial intelligence if I should buy a house

I had to give ChatGPT a try, ChatGPT is an artificial intelligence bot. A human types a question and ChatGPT writes an answer.


Some folks are using it for writing blog posts and for marketing homes for sale.

I asked if I should buy a house and this is the response I got:

“Buying a house is a big decision and whether or not it’s the right move for you depends on your personal circumstances and goals. Some factors to consider include your current financial situation, your long-term plans, and the current housing market in your area. It may be helpful to speak with a financial advisor or real estate agent to help you make a decision.”

The perfect generic response.

This is the answer I got when I asked which is better renting or owning?

“Whether renting or owning a home is better for you depends on your personal circumstances and goals.

Renting can be a good option if you:

  • Don’t plan to stay in one place for a long time
  • Don’t want the responsibilities that come with owning a home, such as maintenance and repairs
  • Don’t have the finances to make a down payment or the credit score to qualify for a mortgage

Owning a home can be a good option if you:

  • Plan to stay in one place for a long time
  • Want to build equity over time
  • Are willing to take on the responsibilities that come with owning a home, such as maintenance and repairs
  • Are financially stable and can afford to make a down payment and monthly mortgage payments

It’s important to consider all the pros and cons of each option and weigh the costs and benefits before making a decision. And also talk to a financial advisor or real estate agent for more guidance and help you make a decision.”

Not bad! I like that but I think I will continue writing. The world needs more humanity and women writers too.

Radon awareness month

January is national radon awareness month and I write some variation of this every January.  The winter months are one of the best times to test radon levels and we have lots of radon in Minnesota.

Homebuyers should always have a radon test as part of the home inspection.  It doesn’t matter if the next-door neighbors have tested and do not have radon or if no one knows of anyone in the neighborhood who has ever had a positive radon test.

When buying or selling a house the radon test should be conducted by a professional. 

Most homeowners have never tested for radon even though it is estimated that nearly half of all Minnesota an estimated 40% of homes have elevated levels of radon.

I’ll never forget the time the real estate agent told the buyers that she had never heard of radon in the neighborhood. It just doesn’t work that way.

Radon gas can be anywhere and everywhere. Radon is a colorless and odorless gas that comes from the soil. When inhaled these fine particles can damage the lungs. Exposure to radon over a long period of time can lead to lung cancer.

The average radon level in Minnesota is more than three times higher than the U.S. radon level. This is due to our geology and how our homes are operated. Minnesota homes are closed up or heated most of the year, which can result in higher levels of radon. In Minnesota, more than two in five homes have radon levels that pose a significant health risk.

Radon can be mitigated.  Sometimes when houses have high levels of radon in them the sellers will agree to pay for a mitigation system.

Learn more from the Minnesota Department of Health

Info graphic national radon hotline 1-800-sos-radon

Trends come and go

Every year we read about the new home fashion trends for the year. The idea is to get people to get rid of what they already have and buy something new. People need to make a lot of money so that they can keep buying stuff for their already too-expensive house.

We need to rethink that idea. There are over 8 billion people on this planet and how we use our resources matters.

Consider continuing to use last season’s throw pillows and rugs. Gently used items can be donated to various charities so someone else can use them. When choosing colors and designs keep it neutral so that the decor doesn’t look dated a year later.

Whites are out this season but pastels are in. That means off-white should work for this season and probably for the next decade.

No, you do not have to redecorate every season or every year. Tasteful decor never really goes out of style. You do not need to redecorate to sell a house. Consider doing some staging, cleaning, and decluttering instead.

17 years of Metro area home sales

Sometimes it is interesting to look at the big picture. We can see that the number of home sales is trending down but the numbers are way above what we saw during the crash.

The housing market peaked during the pandemic, it is reminiscent of the peak in 2006. Going forward the unemployment rate and mortgage interest rates will influence where the housing market goes from here.

Graph closed sales
Closed home sales in the twin cities metro area


Mortgage interest rates easing up

Graph of interest rates going down
Mortgage rate survey Freddie Mac

Mortgage interest rates will likely go down a little more but I don’t think we are going to see rates below 5% any time soon.  Home prices in the Twin Cities metro area are not falling but rising much more slowly.  Houses are still selling quickly but the number of new listings is down and so is the number of home sales.

The slightly lower interest rates make houses just a little more affordable. Mortgage interest rates reached a 20-year high last October.

In other news, rents have been going down after going up last spring and summer.