What Higher Interest Rates Mean for Fort Myers Real Estate
At the beginning of the COVID-19 pandemic, interest rates for mortgage-financed purchases and refinances were at an all-time low, and buyers and homeowners across the country were determined to make the most of it. Top real estate agents in Fort Myers, Florida to Seattle, Washington were bogged down with request after request to show a home, do an open house, and more, with no end in sight.
Now that the mortgage interest rates are starting to climb, there is a marked difference. Those of us here at Coldwell Banker Realty in Fort Myers have taken notice, and we believe that it’s time for you to do the same.
How Do Interest Rates Affect the Housing Market?
Two major factors affect the housing market: inventory and interest rates. For both of these factors, it essentially boils down to supply and demand. With a low inventory, prices on homes are going to be higher, because finding a home to purchase is more difficult.
The same idea applies to interest rates. With lower interest rates, prospective buyers don’t have to pay as much for houses and have lower monthly payments, making houses more in demand and driving up prices. Because of this, interest rates are huge determinants of the value of real estate.
What Should I Expect With Rising Interest Rates?
In the early stages of the pandemic, interest rates were at one of the lowest percentages in recent history, leaving prospective buyers and current homeowners wanting to capitalize on the opportunity. Lower interest rates meant that people could afford homes that they’d previously been unable to afford, and because of this, the demand for homes became extremely high.
Because the demand for homes was so high, this drove up the prices. It quickly became a seller’s market, with buyers offering well above the asking price to even get their foot in the door to buy. Now that interest rates are once again starting to climb, the opposite is true. Higher interest rates mean higher down payments, high mortgage payments, higher escrow payments, and more. With higher interest rates, the demand for housing goes down, which consequently leads to lower house prices.
If you’ve been having a difficult time breaking into the market during the low-interest rates, you might have a bit more luck now with the rates beginning to climb. Asking prices will start to go down, and sellers will be more willing to pay for things like repairs and closing costs. As the interest rates go up and inventory increases, the market switches from being a seller’s market to a buyer’s market, and prospective buyers will have more of a saw when it comes to purchasing a home.
What Alec Salameh Brings to the Table
If you’re hunting for a new home, Alec Salameh is what you’re looking for at Coldwell Banker Realty in Fort Myers. With his expertise in both residential and commercial real estate transactions, Mr. Salameh can give you expert advice from one of the top real estate agents in Fort Myers, Florida. If you have a residential or commercial property for sale or lease, or even a flex space for lease in Fort Myers, Alec Salameh will give it his all to get it sold for you, high-interest rates or not.
If you’re looking for an excellent quality realtor who cares about you, then contact Alec Salameh at Coldwell Banker Realty in Fort Myers today. Get help to narrow down the options out there and find the precise home that’s right for you.
