BUYERS
It’s a great time to buy, seriously!
When rates go up. prices come down. As of September 2023, rates are around 7%. That’s higher than a year ago for sure. But prices have come down and homes are sitting on the market longer than 15 minutes! The buyer now has some negotiating power. You CAN ask for repairs, you DON’T have to compete with 30 other offers, and you are NOT paying above appraisal! NICE!
Is it a good idea to WAIT for the rate to drop? NO!
Let’s say rates go back to around 3%. When rates go down, prices go up. So ALL the people that have been waiting for rates to drop are about to make an offer, a strong one, perhaps with cash, and they are competing against you. What’s worse is now the price is up and you might be paying a lot more.
But low, sell high. Let’s say there was a little 1 bed 1 bath house for sale in 2020 for $250,000 and rates were 3%. Let’s say no one bought that house. Now, that same house is for sale but the rate is 7% and the price is $180,000. Wouldn’t you rather have a balance of $180,000 than $250,000? So, now pretend you bought that house, at $180,000 and 7%. One year later, rates go crazy low to a 2%. Well then, refinance and get that rate! Or, you could sell and do very well! When rates go down, the value of the house goes up! And you bought at that sweet low price of $180,000! Sell it, take the cash, roll it into the next house, with a sweet low rate! Remember, buy low and sell high!