Second only to Forbes.com, MarketWatch is the most often-visited financial and business news site—pulling in more than 38 million unique readers a year. That beats out more prominent names like the Wall Street Journal, Bloomberg, and Reuters. Such popularity can be interpreted as “highly trusted”—but given today’s heightened level of free-floating skepticism, that remains to be seen.
A recent MarketWatch’s “Picks” page presented four predictions for the housing market that might interest readers—including owners of luxury homes and those interested in acquiring high-end properties. It dealt with residential real estate as a whole, but the writers—economists and real estate pros—placed a luxury market prediction first:
Less competition for higher-priced homes. With mortgage rates hitting 5%, homebuyers will have to adjust what they can afford. That means more competition for lower-priced homes.
That’s possible, certainly—but over at the Journal’s ‘Mansion’ page, researcher Liam Baily was not so certain. Although “the luxury market is not immune from changes in the cost of debt or cost of living,” luxury buyers often do not need financing. That leaves them much less affected by interest rate fluctuations, “transitory” or not.
The MarketWatch predictions drew a flood of reader reactions, particularly regarding the likelihood of prices continuing to rise despite climbing mortgage rates. One comment saw this as evidence of “irrationality” in the housing market—which drew strong rejection from others who simply saw buyer demand reacting to limited supply (and today’s market certainly has that). In the wider market for mid-priced homes, tight inventories could continue for years to come since owners will be reluctant to sell when it means giving up sub-4% mortgage payments.