Friday, June 1, 2018
Real Estate Pulse: What You Should Know Now
There are questions on the minds of everyone looking to buy or sell real estate right now. Are rates rising? Is this a good time to buy or will I pay too much? Is it a good time to sell and will I make a good profit? There are many variables in real estate and no one agent, lender, or economist has a crystal ball, but good experience, trends, and statistics help us to get a pulse on what is happening now.
Rates are still historically low according to Freddie Mac, but they have risen nearly half a percent in the last year. They have gone from close to 4.00% to around 4.40% for a 30 year fixed mortgage, and from around 3.25% to just under 4.00% for a 15 year fixed rate mortgage. Freddie Mac also projects that we may see 2 or 3 more rate hikes this year.
Because rates are still fair but are projected to go up it is a good time to buy. Though, in some cases buyers looking to purchase a home under $500,000 may expect to go out a bit further, “drive until they qualify”, or invest in a home that needs a bit of work to stay within their price range. There is a supply shortage, especially for homes in the lower end of the market, under $500,000.
Sellers should know that while rate increases may be causing a sense of urgency, there is not enough inventory to sell. A recent Credit Suisse survey reported an ongoing increase in buyer traffic. Their survey showed a “pent-up demand, especially in more affordable price points, given the persistent inventory shortage”. Sellers may want to take advantage of the buyer frenzy.
Here's to a great year in real estate! Let's get it done!