Interest rates have been on the rise for the past several months. The Federal Reserve has indicated that it will raise rates at least four times this year, up to ¾ POINT! Mortgage rates have climbed over 40% since last year.
How do rising interest rates effect home buyers?
- Rising interest rates make buying a home less affordable.
- Higher interest rates result in an increase in the cost to borrow money.
- Mortgage payments are now higher for the same home/same price just a year ago.
The financial squeeze being felt by home buyers due to the increasing interest rates is just the tip of the housing iceberg. The average cost for an existing home in the United States is just over $375,000; this price is a 15% increase from last year. New home construction has been hindered by the slowing supply chain and the inflated costs of construction materials.
How do rising interest rates effect homeowners who are thinking about selling?
- Homebuyers are needed.
- Raising interest rates will affect the price point of the house. Asking prices will reflect this trend.
- The time is now if you want to sell.
A home purchase is oftentimes the largest single investment that is made in a lifetime. Experience counts when maneuvering the housing market.
FIVE NAVIGATIONAL REAL ESTATE TIPS
- USE a REALTOR. They are licensed, bound by a code of ethics and understand the uniqueness of each buyer and seller.
- Do not get caught up in the real estate “FRENZY”. Use methodical calculations that are best for your situation either selling or buying.
- Be realistic with pricing. Buyers offer only what you can afford. Sellers, be aware of the interest rates and comps in the area.
- Interview your realtor and get referrals. Many deals have fallen apart due to inexperience.
- Know your WHY. Why are you selling? Why are you buying? Your reasons matter and will be your north star as you complete the transaction. Buyer & seller remorse is real.
Need assistance? Del Val Realty & Property Management Sales Division is here to help! Contact Elisha Heebner at eheebner@delvalproperty.com or call the office today for a free consultation.