When you hear that mortgage interest rates are rising, your first instinct may be that this means that homes sales will go down. That’s not necessarily the case. While it’s true that borrowing costs are increasing and interest rates are moving up from their historically low numbers, many real estate professionals still believe that this will actually boost sales. When buyers have been holding out for better prices or better interest rates, when rates start rising those buyers usually “get off the fence” so to speak and purchase property so they don’t end up paying even more in a higher rate or higher price later.
Rates are definitely going up. At the very end of 2012, a 30-year-fixed rate was somewhere around 3.5%. The last week of 2013, a 30-year-fixed mortgage was up to about 4.5 %. Just 1% increase in a mortgage rate can mean thousands of dollars in cost. Buyers don’t want to have to choose between buying their dream home and buying an “okay” home, so they step up to the plate and buy now before rates go even higher. There is a sense of urgency in real estate transactions when changes in interest rates, like these, take place. If you’re ready to “get off the fence” and take advantage of what are still really low interest rates comparatively, I can help you with that. I know the moment-t0-moment changes in the real estate and mortgage market and am here to help you decide if now is the right time.
