Iran war upends spring housing market. Here's what real estate agents are seeing

The all-important spring housing market is well underway, but expectations are falling short due to the war in Iran and its impact on both the U.S. economy and consumer sentiment. Mortgage rates, which were previously forecast to be far lower this spring than last, are now much higher, and concerns over employment and inflation are throwing cold water on pent-up homebuyer demand. Buyers in the first quarter of this year were more concerned about the economy and mortgage rates than they were about home prices, according to real estate agents who participated in the quarterly CNBC Housing Market Survey. "They're fearful of the war, they're fearful of gas prices, their job security," said Faith Harmer, an agent in the Las Vegas metropolitan area. The CNBC Housing Market Survey is a national inquiry of real estate agents selected randomly across the United States. Responses for the first-quarter survey were collected between March 24 and March 30. This quarter, 70 agents shared their insights. When asked about their buyers' primary concern, about one-third of agents said the economy, while another third said mortgage rates. The latter marked a big jump from just 26% in the fourth quarter. Only 9% of agents in the first-quarter survey said prices were their buyers' biggest concern, down from 18% in the previous period. This should come as no surprise, as the average rate on the 30-year fixed mortgage hit a low of 5.99% the day before the Iran war started and then began to climb. It's now hovering around 6.5%. Still, while most agents said prices were either flat or falling, nearly twice as many agents, 29%, reported home prices rising during the first quarter than did in the previous quarter. Price dynamics can vary widely depending on the market and region of the country. But affordability is not improving as much as most experts had forecast. When asked how affordability was hitting buyers, 19% of agents said it was causing them to get out of the market. That was up fr...