How Do Rising Interest Rates Affect My Decision To Sell My Home?
There is a lot of talk today about the economy, inflation, rising prices and many other things that are affecting peoples' finances. I often get asked about how rising interest rates affects the value of real estate. Some of the points I am about to make may be new to you and some maybe obvious.
Rising interest rates DO affect how much home people can afford to buy. If someone has to borrow $300,000 for a new home, if the interest rate is higher, the monthly payment WILL be higher. Some buyers will not be able to afford as much home as they would have 6 months ago. That said, the market STILL has relatively limited inventory and demand for homes is still very high.
One thing to consider is that interest rates are still going up. The Fed is projected to continue to raise them. In the months leading up to the increase in interest rates we were seeing large increases in home values in our area. These increases well outpaced inflation and made it a good thing for homeowners. Now as rates continue to go up, that value may well go up at a slower pace because while demand is high, people can afford to pay less so the number of potential buyers is reduced at a given price point.
But the market is shifting. And rates are continuing to rise. The rising interest rates have just started to impact the market, but they will have an impact.
If you are contemplating selling, or downsizing, it is important that you act quickly in today's environment. How this affects your personal situation is important.
I am always happy to visit with people and discuss the market and how might be best for them to react to the current real estate market. In every market there are opportunities. Is buying or selling the right thing for you to do now? Give me a call, let's sit down and go over the numbers. I have decades of experience in markets with much higher interest rates as well as much lower interest rates than we are seeing today. I can provide you the information you need to navigate today's real estate market.