Home Buying in 95476>Question Details

Patty Marken, Real Estate Pro in Sonoma, CA

Is the rise in interest rates making you more or less motivated to purchase a home?

Asked by Patty Marken, Sonoma, CA Wed Jul 10, 2013

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I'm not hearing any buyers complaining about rising rates, just concern about the increase in prices. Perhaps as inventory continues to grow, things will continue to stabilize in our market.
0 votes Thank Flag Link Sat Jul 20, 2013
Thank you for all your comments
Rates are still at. Historical lows
Prices have really jumped and I see buyers who have waited and really want to buy moving forward here. Over bids are still happening on the low end and high end as well
0 votes Thank Flag Link Thu Jul 11, 2013
There is the "real math" of the rate rise, and that's the part that DOES NOT concern me. On the other hand, there are a whole lot of homebuyers out there without bad memories. They think back on the "top" of the market in 2006 and they don't want that to be them this time around. So any sense that the momentum in the housing market will not continue (and in their minds, possibly lead to the bursting of any bubble...) is enough reason to give them pause. I believe the market fundamentals are still good and I believe rates will trend back down, but these aare no match for market, herd-based psychology...

It will be interesting to see the next couple of months play out.
0 votes Thank Flag Link Thu Jul 11, 2013
There is some slowing now, which is typical after spring is over. I believe the sudden rise in home prices as a result of the market frenzy over the past 6 months has a lot more to do with any additional slowing than the rise in interest rates, although they both play a part. The market is still overall very active though as the rise in rates does motivate some people to buy now before rates rise further.
0 votes Thank Flag Link Wed Jul 10, 2013
As a fellow Realtor in Santa Rosa, I do know with with my current listings that Buyers have slowed down - both viewing and submitting offers. I've spoken with multiple other long-time Agents and they say the same thing "buying has slowed coincident with the rates creeping up".

However, when speaking directly to Buyers I've started speaking about what the "creeping up" of rates actually means, for their monthly payments. In some cases, it's $50+ more than when rates were under 4%. It's amazing how many Buyers are not educated - by their Agent or their Lender - as to what the math equation really is with these truly all-time low rates that yes, are starting to creep up.

I think if all Realtors think this way: mathimatically speaking, how would these current rates affect monthly payments of their potential Buyers, then more people would become [more] motivated again as housing values and prices are still really good buy right now.
0 votes Thank Flag Link Wed Jul 10, 2013
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