Interest Rates Attack San Diego Real Estate

By
Real Estate Agent with The Lewis Team at Keller Williams Cal BRE #01352522

Higher Interest Rates Could Slow San Diego Real Estate Market Recovery 

With San Diego real estate moving in an upwardly direction over the past couple of months recent interest rates could slow home buying activity. Home buyers in
 San Diego have been, in some areas of the county, fighting over homes that come up for sale. Many San Diego home buyers have offers in on short sales and jump all over the bank owned REO foreclosures the day they hit the market. Unfortunately the bank owned REO's already have offers on them the day they come up for sale and sometime even before they show up in the MLS.

This has many home buyers frustrated and wondering what they have to do to get a house or condo in today's San Diego Real Estate Market. Another issue that has been waiting to rear its ugly head is interest rates. When interest rates rise home buyers see their purchasing power reduced. Keep in mind when interest rates go up the monthly payment for a homebuyer also goes up and sometimes more than what they are comfortable with.  Many times the lender will have to reduce the purchase price of what the homebuyer can qualify for.

This scenario can also have a real negative effect on the real estate market in general. If a home buyer wanting to buy a home has had a certain purchase price and monthly payment in mind for a certain size and quality of home and then they're told that they can't buy the same home at the same monthly payment, many of them will decide not to buy. Some will wait for the homes that they were recently able to buy at a certain price range to come down into the loan amount of what the comfortable monthly payment is that they had already had their hearts set on. Some of them won't be able to afford the same home they thought they could buy and won't settle for less of a home now. These factors could show a decline in demand and then a decline in home prices. We'll have to wait and see. Oh, and don't forget about the foreclosures to keep the median home price in San Diego from gaining too much ground. There are a few years of that left.

Mike and Dawn Lewis - Realtors in San Diego CA - The Lewis Team at Keller Williams

If  you need help buying or selling a home or condo in the San Diego area make sure you contact us we're your San Diego Realtor.

 

Search for Homes and Condos in these Communities

 
Carlsbad Real Estate 92008, 92009, 92010, 92011 
Oceanside Real Estate 92054, 92056, 92057, 92058 
 
 
Escondido Real Estate 92025, 92026, 92027, 92029 
San Marcos Real Estate 92069, 92078 
Vista Real Estate92081, 92083, 92084
 
 
Bay Park Real Estate 92110, 92117 
Clairemont Mesa Real Estate 92110, 92111, 92117 
 
 
 
 
Chula Vista Real Estate 91910, 91911, 91913, 91914, 91915 
EastLakeReal Estate 91913, 91914, 91915 


San Diego Real Estate        Carmel Valley Real Estate       Chula Vista Real Estate   

All Information is believed to be correct but not guaranteed 

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Rainmaker
637,278
Maria Morton
Chartwell Kansas City Realty - Kansas City, MO
Kansas City Real Estate 816-560-3758

Mike, love the 3 headed laser eye dragon!

Jul 21, 2009 04:03 AM #1
Rainmaker
487,190
TIM MONCRIEF
Tim Monciref - Austin, TX
Over 2,000 homes sold…..

Love the picture.  Wish interest rates were the whole picture, but until we see a reversal in unemployment figures, confidence will lag.  Confidence will overcome the interest rates as pricing will drop in reflection of any rise in interest rates.

Jul 21, 2009 05:32 AM #2
Rainmaker
682,798
Sidney Kutchuk - Realty Works Temecula Kutchuk - Realty Works Temecula
Realty Works Temecula - Temecula, CA
Realty Works Temecula

Interest rates will definitely make a shaky market worse.  I have been pre-qualifying everyone at .5% higher!

Jul 21, 2009 01:03 PM #3
Rainmaker
214,937
Mike and Dawn Lewis
The Lewis Team at Keller Williams - San Diego, CA
The Lewis Team at Keller Williams in San Diego CA

Maria and Tim - thanks for the comments. Jane I HOPE all is going well. It's nice to hear from you.

Mike

Jul 29, 2009 03:10 PM #4
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Rainmaker
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Mike and Dawn Lewis

The Lewis Team at Keller Williams in San Diego CA
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