Have you been thinking about buying a home, but are concerned that higher interest rates have erased your opportunity to purchase an affordable property. Think again.
Believe it or not, the rise in interest rates may be a blessing for new home buyers. How so?
According to a report on Good Morning America, home sales rose by 38 percent during the pandemic in the last two years, but with the shift in interest rates, the housing sales have waned by eight percent and housing prices are dropping. Inventory has grown by twelve percent and with that, new deals are blossoming too.
Although the 30-year mortgage rate now exceeds six percent, almost double the previous rate, average homeowners find they can shoulder the extra burden with the drop in home prices. And then, experts advise when the interest rates drop in the future, the homeowner can refinance.
Timing, however, is crucial. Those in the real estate industry suggest potential buyers get preapproved for funding and gather all important financial records: pay stubs, tax forms, and investment statements. Also, the buyer should research the most relevant information about the value of the property.
Additionally, sellers may want more flexibility from buyers to close the deal, either a longer closing time or a quick closing if the seller has purchased a new home.
Despite interest increases, this new financial shift in the housing market may have a silver lining for buyers.
