Interest Rates on the Rise
Last week, the Federal Reserve Chairman announced another interest rate increase, making it clear there will be more increases in interest rates in the coming months. 30 year fixed mortgage rates have risen approximately 300 basis points. Example for a $900,000 mortgage, monthly payment has increased from $4,041 in February to $5,040 today. The pain of higher payments will result in the shrinking of the buyer pool. As rates continue to increase, pricing a property properly will be the key to attract buyers. Rental rates and demand for rentals have increased substantially because more buyers are forced to rent. According to experts, the mortgage rate will stabilize or even decline when the inflation rate starts to fall.
Yun, L. (2022, June 15). Instant reaction: Interest rates, June 15, 2022. www.nar.realtor. Retrieved June 16, 2022, from https://www.nar.realtor/blogs/economists-outlook/instant-reaction-interest-rates-june-15-2022