Mortgage rates increased this week averaging 5.29%, highest of the year according to Freddie Mac. Will this increase in the interest rate be the motivation you were waiting for in order to jump into the real estate market?
Back in the Day
Back in the day we use to say rising mortgage rates acted as a stimulus that would move homebuyers off the fence. However few things we are experiencing in today’s real estate market resembles anything from “back in the day”. Concerned that a rise in interest rate would reduce the buying power of the home buyer or that in order to obtain a better rate the buyer may have to pay a point or two would result in the buyer signing on the dotted line.
Back to today
I guess we will see over the next few weeks/months if the rising interest rate has an impact on home buying. For rates to have a serious impact they may have to reach levels not seen in sometime. Maybe if start hitting 2000 levels of 8% we will see buyers jumping off the fence. Right now for someone wanting to buy a home there are plenty of reasons to do so that have nothing to do with interest rates. Banks owned & short sale transactions have attracted buyers & investors who could no longer sit back and watch these great deals come and go. Government help in the way of the first time homebuyer tax credit also works as a motivating factor to new buyers.
Perhaps none of the reasons mentioned are why you are thinking of buying a home. Whatever the reason, there are plenty of homes in all prices for you to choose from. Give me a call to discuss your situation. 407-304-0255
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