Here’s how our low interest rates have had an effect on home prices.
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The question of whether mortgage interest rates will offset real estate price increases has been a very common question among buyers, so I wanted to address it here today.
First, you should understand that interest rates are the No. 1 reason why prices have increased lately. Interest rates are almost zero and everybody wants free money. That has brought all kinds of people into the marketplace.
“The longer you wait, the more you’ll lose.”
With this current situation, prices will continue to rise, but rates are so low that they’ve offset prices. In 1995, you would have paid the same amount for a house as you will today because of the low interest rates.
In March, April, and May, we saw a big slowdown, and there were twice as many homes coming on the market as coming off of it. Things turned around in the summer, and the market has flipped. Right now, supply is low, demand is high, and prices are climbing. The longer you wait to get in, the more this situation will work against you.
Now is the time to get in while interest rates will offset your price. This situation won’t last forever, so if you’ve been thinking about buying a home, now is the time to take advantage.
If you have any questions about our current market or real estate in general, call or email me. I would love to help you.