Existing home sales rose 7.9% to a six-and-a-half-year high in August, according to the Census Bureau. This increase is due in part to anticipation of rising mortgage interest rates. Is now the time to sell or buy?
An increase in mortgage costs is an extremely important factor in real estate purchase decisions, and most consumers suspect the Federal Reserve can’t continue holding rates at historic lows much longer. Add this with the shrinking housing inventory and you have a perfect storm for a rise in home purchases. If potential homebuyers hold out for too long, not only will they be paying a higher sticker price for their new home, but they will be missing out on the lowest interest rates they can expect to find in their lifetimes.
And for sellers the projected increases in interest rates would be predicted to decrease sales of homes as mortgages become more expensive, thereby driving seller price levels down. The rising prices would not benefit sellers, as mortgage companies would take the higher interest and pressure sellers to lower their selling price to compensate.
So for both buyers and sellers now is the time to move – buyers to capture low interest rates and fair housing prices, and sellers to take advantage of maximum returns given the low interest rates and strong market demand. United Country numbers exceeded these increases in both September and year-to-date. As of last month, United Country saw a 9% increase in residential sales volume year-to-date, with country homes leading the way in September at 11%.