I am sure that most people are aware that during the course of 2017 and early 2018 home prices made a giant 10 percent jump. Home prices are estimated to rise in 2019, but at a much slower pace, and the number of homes for sale is expected to increase by a mere 1 percent.
What’s the Reason? Well, part of the reason could be due to the increase of interest rates.
Mortgage interest rates are on the rise after years of being at a standstill. Some experts project Interest Rates to increase to an average of 5 percent for a 30-year mortgage and a 4.4 percent for a 15-year mortgage. But before we get too excited about the increase in mortgages, it doesn’t mean the economy is in trouble. It’s the opposite!! To help stabilize the strong economy and rising inflation during the past few years, the Federal Reserve increased short term interest rates. It’s natural to see a trickle-down effect to the bank level like what we’re seeing now with mortgage interest rates.
The Increase basically means more people are willing to spend and borrow. Expect things to be a little different next year as buyers and sellers adjust to these changes
Market Review estimates home prices will continue to rise for the next couple of years with annual increases 2-6 percent. Great news for sellers! Everyone knows that it is impossible to know for sure, factors indicate a housing crash is not in the foreseeable future and the economy is still strong. Here are some indicators:
- People are still spending money;
- Low unemployment rate and new career opportunities;
- All cash buyers are becoming more common;
- Fewer buyers are using interest only loans; and
- Taxes are lower.
What does this all mean for sellers?
When listing your home, be very knowledgeable of your competition. A lot of homes are being priced out of the market. Price your home close to appraised value. Your Realtor should be able to provide you with a market analysis. Sometimes it is advisable to have your home Appraised before putting on the market. There are many times the Appraisal can prove to be very valuable when negotiating the price. Buyers are very savvy today when they are buying homes. They have access to public records that can inform them about all pertinent information.
Higher interest rates can ward off buyers, especially first-time home buyers. With interest rates increasing, make sure you contact your mortgage lender. It is important to know what interest rate you will pay.
Our thoughts on this topic: The information pertaining to interest rates and some estimates do not necessarily reflect this area.
2019 has started out to be a very good year. We are seeing sellers getting close to their asking price (if priced right) and Buyers are willing to pay the price. The inventory at Lake Oconee is very low in some price ranges. This is a great time to sell, as we feel it is a Seller’s market. Yes, interest rates have gone up, but let’s look back and remember when interest rates were in the teens. I am sure some of our readers can relate. Interest Rates will always fluctuate.
With a good economy and beautiful sellers to sell, we have a lot to offer at Lake Oconee. We are getting many inquiries about this area.
THOUGHT FOR THE DAY: If at the end of the day you feel dog-tired, maybe it’s because you growled all day.
**Some of my information comes from Dave Ramsey, American fFinancial advisor, radio talk host and businessman.
Don and Shirley have more than 24 years experience as REALTORS in the Lake Oconee Area. Shirley (Don or Shirley) can be reached at 706-453-6333. Email firstname.lastname@example.org. Real Estate Company: Jo Jones & Co. Real Estate. Specializing in all gated and non gated communities, including Del Webb.