How Rising Rates Affect Homebuyers and Sellers
Higher interest rates can (and already have) affected homebuyers.
If you’ve been keeping an eye on the real estate market, you’re probably aware that interest rates have gone up by 1% since last month. What does that mean for you? To keep it simple, if you were pre-approved to buy a house a month ago at $300,000, today you would only be approved for $270,000.
The general rule of thumb is that a 1% increase in the interest rate decreases your buying power by about 10%. This affects home sellers, too. Their pool of buyers shrinks as rates go up, and housing values will go down as well.
We could absolutely see a change in this market due to an increase in rates, so we’ll make sure to keep an eye on it for you moving forward.
If you have any questions for us about interest rates or real estate in general, don’t hesitate to reach out via phone or email today. I look forward to hearing from you soon.