Over the past two to three years, the United States has experienced some of the lowest mortgage rates yet. There were points in 2016 where the interest rate on a 30-year fixed mortgage loan was below 3.5%. However, in 2017, we have begun to see the interest rates rise. Currently, the average interest rate on the same loan is about 4%.
But, how does this affect the real estate market and buying a house? Great question! The real estate team at Raleigh Cary Realty can share exactly how that mortgage rates affect home sales.
3 impacts the Raleigh real estate market could see as mortgage rates continue to rise are:
- The Cost of Buying a Home Will Rise: This sounds very intuitive, but it will impact our Raleigh real estate market further. When interest rates rise, the cost of home increases. And thus, there will be fewer home buyers in the market due to the increasing cost of purchasing and owning a Raleigh home.
- Less Bidding Wars: When mortgage rates increase, Raleigh homes will be less affordable for many home buyers. Thus, there will not be as many individuals bidding for one home.
- Low Inventory Will Subside: Raleigh, Cary, and Apex have very low inventory for home buyers. When the cost of buying a home increases and fewer individuals are competing for one Raleigh home, there will be more homes on the market for longer. Overall, we will see all homes on the market for a longer amount of time.
Maybe you are considering selling your home or buying a new home? The next question is what does this mean for you? The expert team at Raleigh Cary Realty can help answer those questions for you as well as lead you to the right decision to make about your home buying and home selling process. Contact us today with any questions!