How are rising interest rates impacting people in our current market?
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As you may already know, we’ve recently seen a rise in interest rates. Last year, interest rates were around 3.4%. Now, they are up to 4.4%.
This rise has a direct impact on buyers and sellers in today’s market. The amount sellers can ask for a property and the amount of buying power people have during their home search are two primary examples of this.
Let’s imagine a home with a purchase price of $400,000. A 1% rise in interest rates would cause buyers to lose around 10% of their buying power.
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Rising interest rates have a direct impact on buyers and sellers in today’s market.
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Decreased buying power affects sellers, too. If sellers hope to entice today’s buyers, they must set lower prices than in the past.
I don’t have a crystal ball, but I can see that it’s becoming more expensive for buyers in today’s market.
In other words, now is the time to lock in rates while they’re still relatively low. If you’re a seller, now is also a great time to list, since waiting could make it harder to command top dollar.
If you have any other questions or would like more information, feel free to give me a call or send me an email.