Posted by Karen Heet on Thursday, August 18, 2022 at 1:54 PM By Karen Heet / August 18, 2022 Comment
1% Rate Increase = 10% Price Decrease
For a family that can afford $2,000 a month for a mortgage, at a 2% interest rate, they could afford a $540,000 home;
at a 3% interest rate, a $480,000 home;
at a 4% interest rate, a $430,000 home;
at a 5% interest rate, a $380,000 home;
at a 6% interest rate, a $340,000 home.
Home prices went up drastically in 2020 and 2021, in part because of the extremely low mortgage interest rates of between 2-4%.
But interest rates are going up.
The federal reserve has committed to halting inflation and in an effort to “cool” the economy, multiple interest rate hikes have been promised.
FOR SELLERS, PRICING YOUR PROPERTY CORRECTLY MATTERS NOW MORE THAN EVER!
Make sure you work with a Realtor who tells the truth, and gets results.
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