Just what impact have higher interest rates had so far?

By
Mortgage and Lending with Silicon Valley Capital Funding

The answer is surprising, as currently the real estate market has been able to weather the dramatic jump in interest rates these past 60 days.

As we see more time go by, will this trend continue? Just how much of the current strength is due to people panic buying due to the concern over continuously rising rates?

The refinance market has dropped to near death and a trickle.

What does the second quarter profit data that major banks are declaring mean and will it last? Since half of the quarter was at lower interest rates and many of the closed loans were still at those lower interest rates, we anticipate that 3rd quarter results for banks will be substantially less, to reflect the lower refinancing activity.

What is the silver lining? This jump in rates can be used to motivate fence sitting clients into action.

Should the market drop enough, the government could announce that they will delay keeping the market artificially low with their bond purchase activity.

 

The next 60 days will tell us quite a bit about the future of interest rates, as school starts and buying activity calms.

 

Comments (6)

Annie Fleeting
NextHome Beach Time Realty - Saint Pete Beach, FL
Annie Fleeting

Buckle your seat belts! I agree completely that the undecided Buyer has been needing some external impetus to get them off of the fence! Static(ish) interest rates have allowed people to think they had all the time in the world and could wait until that perfect storm of price, interest and dream property dropped on their heads! Rising prices, coupled with interest rates moving upward should signal that it is time to get a Move On!

Jul 16, 2013 07:05 AM
Ken's Home Team LLC. | 360.609.0226 | Portland, OR & Vancouver, WA Real Estate Team
Ken's Home Team LLC. - Vancouver, WA
- SOLD IS OUR FAVORITE 4 LETTER WORD -

Welcome to Activerain from from all of us at Ken's Home Team. I think you will find this site to be a wealth of knowledge and referrals. This really is the best real estate blogging and real estate network on the internet. If you have any questions about Activerain, reach out to the wonderful Ambassadors here in the rain. (They are a wealth of knowledge and were picked by the Activerain staff for their willingness to help others)

Jul 16, 2013 02:46 PM
Todd Clark - Retired
eXp Realty LLC - Tigard, OR
Principle Broker Oregon

Welcome to Activerain and I hope you are learning a lot and if you ever need any assistance, don't hesitate to check out my blog, email me, call me, I will be glad to help you in any way possible. Also, check out the main page of Activerain and look for the Activerain University tab, there are lots of educational webinars to help you build your business.

Jul 16, 2013 02:53 PM
Eric Nelson, III
Silicon Valley Capital Funding - Campbell, CA
Eric O. Nelson, III

Annie, I totally agree. This can be a great conversation for action with clients - move before rates and market values move higher.

Jul 17, 2013 03:00 AM
Eric Nelson, III
Silicon Valley Capital Funding - Campbell, CA
Eric O. Nelson, III

Ken, thank you - I am new to the site and just beginning to learn how powerful of a resource it is.

 

The people who are on here demonstrate a great commitment to our industry and to their clients.

Jul 17, 2013 03:01 AM
Eric Nelson, III
Silicon Valley Capital Funding - Campbell, CA
Eric O. Nelson, III

Todd, thank you for the offer and input. As a new member I have much to learn about them and look forward to interfacing with everyone.

Jul 17, 2013 03:03 AM