The main fear buyers should have regarding rising interest rates is how hesitant they might make some home sellers from actually listing their homes.
Should you be worried about rising interest rates?
Mortgage rates have been going up, and we’re not seeing the historic low levels we were years ago when the market was having challenges. We’re above the 4% range, and Freddie Mac’s chief economist is stating that the time of the sub-4% interest rates is probably behind us.
There are a few reasons behind this increase. The first is the fact that our economy is getting better. A lack of available homes for sale is also increasing the demand from buyers out there. Mortgage applications have increased about 10% compared to last year.
The main fear buyers should have from rising interest rates isn’t that their payment will increase dramatically—it will, and you should meet with a lender and see what your payment would look like if you waited until rates climbed closer to 5%.
Rather, the main fear they should have is that because we already have very low inventory, sellers may be hesitant to list their homes if they already have a low interest rate locked in on their house. If they choose to hang onto their homes instead of list them, that will cause inventory to go down even further.
The good news is we list multiple homes each month, and we can show you properties that aren’t on the market yet.
If you’d be interested in something like that or you have any other questions about our current market, don’t hesitate to reach out to me. I’d be glad to help you.