There are a variety of economic variables to consider when selling your house for sale in Cornelius when interest rates are on the rise. Generally speaking, when interest rates rise, your pool of buyers shrink. Higher interest rates mean that buyers have to fork out extra cash over the life of their mortgage! The Fed has projected that rates will rise to 3 percent by 2020. Read this article to learn about selling your home when interest rates are rising!
The Problem When Interest Rates Rise
As a rule of thumb, with every 0.25 percent rise in interest rates, home buyer purchasing power decreases by 3 percent. This means that because of the extra money required to pay interest on a mortgage for your Davidson house for sale, home buyers simply won’t be able to afford as much house.
With the decrease in potential buyers, comes an increase in supply as well. However, if you do see a sudden uptick in interest rates, there will likely be an initial surge in buyers trying to take advantage before interest rates rise even more.
Other Factors to Consider
Remember, supply and demand play a significant role in housing prices. You will see home prices increase when supply is low and demand is high. You will see them decrease when supply is high and demand is low. As a seller, it’s important to keep this in mind when deciding when to put your Concord home for sale on the market.
Even if you start to see rising interest rates, remember there are always buyers out there with low debt-to-income ratios and high monthly incomes who are easily able to absorb the cost of rising rates. If you market your home well enough, it’s easy to attract these sought after buyers and get a great deal on your property despite the market!
Do you have any tips on selling your home when interest rates are rising? We would love to hear your thoughts.