Back in the 80’s, a mortgage could mean shouldering an interest rate in the double-digits. Rates have been getting lower since then, but not quite to the extent we see today. If you’ve been keeping up with the news, it seems like there’s a new record-low rate every week!
Here’s what that means to people in the real estate market.
Why Interest Rates Matter
We all know that borrowed money comes with interest. The higher the interest, the more money you need to pay back (and vice versa). But when it comes to a mortgage, there’s more to it than just the payments. From property values, demand for those properties, and how many of them are up for sale, almost every part of the real estate market is affected by current interest rates.
Whether you’re buying a home or selling a property, understanding how it can affect your situation is vital to your success.
Low Rates Attract More Buyers
The events of 2020 have caused many people to put their buying plans on hold. But with the rates as low as they are today, it may finally be time to get moving again.
If you’re a buyer, you can take advantage of low interest rates in a few ways:
- Make lower monthly payments and save money.
- Buy a more expensive house since low rates make monthly payments more affordable.
- Repay a mortgage faster because you can pay more than required each month.
It Also Creates Opportunities for Sellers
People paying less for properties can seem like only buyers are benefitting. But as we mentioned earlier, price is only part of the bigger picture.
Even when interest rates are low, sellers should also consider getting back into the market for the following reasons:
- Spend less time selling because more buyers are looking to buy a house.
- Get a better price since more people are competing for your property.
- Increase overall property value as fewer homes are up for sale.
Is This Your Chance?
These unprecedented rates should make you take a good look at any opportunity that comes your way. If you want to be sure that you’re making the right call, our agents can help. Knob & Key is committed to providing excellent service to anyone who wants to achieve their real estate goals. When it’s time to close the deal, we’ll make sure you have no regrets. Get started by contacting us today.