Housing Watch: Looking at the current Fresno market

FRESNO, Calif. (KFSN) -- The average mortgage interest rate to buy a Valley home today is 7%, about 2% higher than a year ago.

But experts say home buyers have started to adjust their expectations during their search.

"Last year's interest rates put a stop to the market essentially," says Fresno Association of Realtors President Brian Domingos. "It's taken a while but now that consumers have gotten used to the fact that the rates are what they are, we're starting to see people come back into the market."

Domingos doesn't expect mortgage interest rates to start to dip until the end of the year, maybe the beginning of next year.

Those in the market have found a lack of housing inventory because many homeowners are locked into low interest rates and don't want to sell right now.

"For perspective, a healthy inventory is about 5-6 months supply, and we've got less than two months so very, very limited supply," Domingos said.

Because of high home prices, Domingos noticed many people are looking at houses in small towns outside of the bigger cities like Fresno and Visalia.

"It's a seller's market," he said. "It has been for a long time, even with the rate increase. It's still very competitive. In fact, in California, we're seeing about 43% of listings are selling for more than their list price, which tells you competition is still stiff."

He adds the buyers are out there, but they don't seem to be finding what they really want due to the low inventory.

Domingos adds investors are still buying properties in the Valley, which makes the market more challenging for first-time homebuyers.