While the United States Federal Reserve doesn’t directly set mortgage interest rates, the actions the Reserve makes can have an indirect effect on mortgages rates and the overall housing market. The same applies to the global economy. Still, if you’re thinking about buying or selling in Greenville in this market, it’s important to have a solid understanding of what these changes mean and how they could affect your next real estate transaction.
Understanding the Increase in Interest Rates
In mid-March, the United States housing market saw an increase in mortgage interest rates across the board. This was not unexpected—especially when taking into consideration that interest rates have been on the rise since the presidential election back in November. In fact, interest rates have now risen three times since the end of 2015 alone. It is also expected that rates will rise at least three more times throughout 2017, but only time will tell exactly how high the rates will go. Most experts predict they will not reach more than 5%.
What the Rate Hike Means for Buyers and Sellers
This mortgage interest hike may seem a little scary for those in the real estate market—particularly those interested in buying in the near future. It’s important to realize, however, that these rate hikes have a way of working themselves out, and the increases themselves aren’t too significant. In fact, interest rates are still low, relatively speaking, with the average for a 30-year fixed mortgage just around 4.2%. In most cases, predicted rate hikes wouldn’t increase the average buyer’s monthly mortgage payment by more than $20-$30 per month.
On the other hand, these slightly higher interest rates can make now a good time to sell real estate for those who have been considering it. Currently, there is a rather small selection of homes available for purchase, making demand high in most areas.
Whether you’re interested in buying or selling commercial or residential real estate—or even if you’re interested in investing in real estate through development services, contact The Parker Group. With more than 40 years of combined experience, our experts can assist you through the transaction process to ensure your goals and best interests are addressed.