The real estate marketing has been intense for a while now. We all remember when buyers could get a house under list price. Times have changed. Inventory is low and there are an increased demand. Covid changed a lot of things. The need to work from home. The need to have more space in their home. Maybe a move was needed because of a career change. Regardless, we’re all trying to keep up with this crazy market.
The next big thing you need to be prepared for – rising interest rates.
How will rising interest rates affect real estate?
“As interest rates rise, it will take a chunk of buyers out of the market because they can no longer afford the homes that have appreciated so much. Interest rates will have to go up significantly in order for it to start to soften housing prices.”
How does this effect you?
- Higher interest rates, translate into higher mortgage loan costs.
- Rising rates make homes more expensive for buyers, thereby reducing the demand for home purchases.
- Reduced demand also hurts sellers as they need to reduce the prices of their homes in order to attract buyers.
- If the economy grows fast enough, rising mortgage rates will not have as great an effect on property value and housing prices, as long as salaries and wages correspondingly grow as well
What’s the next step?
Don’t panic. This simply means, if you’re ready to buy or sell, now is the time. Give us a call so we can make a plan of action that fits your family’s needs.