Interest rates are on the rise. While they’re still historically low, they’re definitely higher than they were a year ago, which can be less than optimal for buyers. Many of the buyers we’re seeing in the market today are very cognizant of this shift.
Today’s homebuyers still have the same access to the upfront money for down payments and closing costs as homebuyers from the past couple of years. However, buyers today are now realizing that their money won’t go as far, due to rising interest rates.This is one of the reasons why we are seeing demand start to shift. For example, if your house was listed on the market for the same amount today and at this time last year, today’s homebuyer would end up paying more for the exact same house at the exact same price due to the higher interest rates. Right now, it’s those long-term financials that are the current issue for buyers.
Sellers may want to ask themselves what they can do to reduce the long-term effects of high interest, so they can attract the best buyers, and get their homes sold quickly. As a result of the rising interest rates, some buyers can’t afford as much of a home because their monthly payments will be higher just due to interest.
As a home seller, you’ll also want to watch out for places where financing may fall through. Since interest rates are rising at a fast pace, you may be in a situation where your buyer was pre-approved at a certain rate when making the offer, due to interest rates rising in the interim, now they can’t get approved for the same mortgage amount. This is an uncomfortable situation to be in for both the buyer and the seller.
If this happens, as your real estate agent, I will speak with the buyer’s real estate agent and advise they have their buyer client(s) speak with their mortgage lender to see what options can help their specific situation. Options available may be to extend the amortization period, or pay what they can afford now and top up their payments later, rather than having to go through the entire purchasing process again.
As your Seller agent, I will guide you through every step of this process, and market your home so you can attract the best buyers and sell your property for top dollar even in a time of rising interest rates.
If you want help getting your home sold quickly and for the best ROI, contact me!