Over the past couple of months interest rates have been on a steady rise. During this time mortgage applications have also been on the rise as homeowners race to take advantage of historically low rates. So, what does this mean for the real estate market?
Inventory is staying just about the same but buyers are flooding the markets while interest rates are low. This is all leading to home prices rising and bidding wars breaking out on almost every home that is priced right. Even homeowners who bought at the peak of the market in 06-07 are selling their homes and taking losses because they realize that if they wait for their home's value to rise, their replacement home's value will rise as well essentially evening it all out. However, they actually save money rather than lose money when selling now because they can buy their replacement home with a low-interest mortgage.
In my opinion until mortgage interest rates hit 6% (the point where renting and buying are equally affordable), we will continue to see home prices rise.
As always, if you have any questions about my services or the real estate market in general, feel free to reach out to me. KyleKovats@gmail.com
-Kyle Kovats, New Jersey Realtor
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