If you’ve got a move on your mind, you may be wondering, “Should I wait for mortgage rates to come down before I move?” Here’s some information that could help answer the question of whether you should wait to sell.
In the housing market, there is a longstanding relationship between mortgage rates and buyer demand. Typically, the higher the rates are, the lower you’ll see buyer demand. That’s because some people who want to move will be hesitant to take on a higher mortgage rate for their next home. So, they decide to wait it out and put their plans on hold.
But when rates start to come down, things change. It goes from limited or weak demand to good or strong demand. That’s because a big portion of the buyers who sat on the sidelines when rates were higher are going to jump back in and make their moves happen. The graph below helps give you a visual of how this relationship works and where we are today:
As Lisa Sturtevant, Chief Economist for Bright MLS, explains:
“The higher rates we’re seeing now [are likely] going to lead more prospective buyers to sit out the market and wait for rates to come down.”
Why You Might Not Want To Wait
Maybe you’re asking yourself, “What does this mean for my move?” Here’s the golden nugget. According to experts, mortgage rates are still projected to come down this year, just a bit later than they originally thought.
When rates come down, more people are going to get back into the market. And that means you’ll have a lot more competition from other buyers when you go to purchase your next home. That may make your move more stressful if you wait because greater demand could lead to an increase in multiple offer scenarios and prices rising faster.
But if you’re ready and able to sell now, it may be worth it to get ahead of that. You have the chance to move before the competition increases. And, even in today’s housing market, less competition means that buyers have more leverage to negotiate with sellers.
Bottom Line
At Bay Shores Real Estate we specialize in helping people find the home of their dreams. We are a partnership of professionals, each dedicated to helping people find the life they love by bringing all of the key real estate-related services discerning clients need together under one roof.
Let us provide a complimentary property analysis and value report for your current home. This free report will show you how your house compares in value to other homes in your area and what you could likely expect to get for it in today’s market.
So, if you’re thinking about whether you should wait for mortgage rates to come down before you move, don’t forget to factor in buyer demand. Once rates do decline, competition will go up even more. We should talk if you want to get ahead of that and sell now.
