Interest Rates vs. Property Prices

Interest rates are undeniably up from recent years. A couple of years ago we saw interest rates drop below 3% and many home buyers as well as existing homeowners took advantage to buy a home or refinance their existing mortgage loans.

Lower interest rates also provoke buyers who may have been on the sidelines trying to figure out if they were ready to buy. This leads to a shortage of inventory in the market since so many buyers enter the market looking to purchase and finance their property at the low interest rates. Ultimately, what we end up with are higher prices and bidding wars on properties.

While interest rates are high, inventory sits longer and property prices dip from sellers looking to entice potential buyers. Sellers will also throw in other concessions in order to move their property off the market.

If you are looking to buy, don’t wait for interest rates to drop. Buy the property and refinance later. The price difference will offset the higher interest rates in the long run.

To learn more or if you’re looking at buying a home soon, reach out to us. We will be happy to answer any questions you may have.