…that interest rates have gone up almost a full point in the last month? A one percent increase in mortgage rates can reduce a buyer’s purchasing power by up to 10%. Even if the price of a home drops by 10%, a 1% increase in rates can have significant long-term and short-term financial impacts.
Not only does a one percent rate increase more than offset a ten
percent reduction in home prices, but it also reduces a buyer’s
purchasing power by increasing
debt-to-income ratios as monthly mortgage payments will be greater.
With the recent increase in rates, now more than ever it’s important to partner with the right real estate professional.