Interest Rates Rising? Why it DOESN'T matter!

By
Managing Real Estate Broker with Sidewalk Homes

Not a day goes by that I don't hear some realtor or lending spouting off about how interest rates are going to rise (1st quarter 2016) and when that happens, buyers will not be able to afford as much house so YOU BETTER BUY NOW!

 

As a real estate professional, this offends me.  We don't live in a vacuum - if interest rates DO rise (which I'm not convinced will happen, by the way), that put downward pressure on housing prices.  So if interest rates rise 10% and home prices drop 5%, is it really a worse time to buy?  I don't think so.

 

The truth is, none of us know with certainty what's going to happen.  What buyers should do is look at their personal situation and buy when it makes sense for them.  

Comments (26)

Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

I don't hear that at all from lenders.  Maybe you just need to talk to different lenders.

Oct 17, 2015 02:03 PM
will bateson

I hear it more from realtors than lenders but do hear it A LOT - to me it's misinformation.

Oct 18, 2015 12:44 PM
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

Good morning, will bateson I agree 100%... we all need shelter...it's a necessity and housing prices will rise and fall in direct proportion to the status of the interest rates at any one time.... but sales will always go on....

Oct 17, 2015 11:12 PM
will bateson

Thank you Barbara, great minds think alike LOL.

Oct 18, 2015 12:44 PM
Barbara Todaro
RE/MAX Executive Realty - Retired - Franklin, MA
Previously Affiliated with The Todaro Team

and welcome to ActiveRain....it's a great place to learn, share, market and network....and I hope you enjoy all of it as much as I have over the past 6 years....

Oct 17, 2015 11:13 PM
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

will bateson Welcome to Active Rain!  As REALTORS who have been here (on and off) for close to 9 years, it's well worth it!

Oct 17, 2015 11:27 PM
will bateson

Thanks Tony and Suzanee,


I was on Active Rain years ago, ready to start again.

Oct 18, 2015 12:45 PM
Mark Don McInnes, Sandpoint-Idaho
Sandpoint Realty LLC - Sandpoint, ID
North Idaho Real Estate - 208-255.6227

Top of the morning Will.  Yes it is all relative.  Welcome to Active Rain.   Trust you will enjoy the interaction and all that is available beyond what most of us originally join for.  Make it a great Sunday.  Mark

Oct 17, 2015 11:52 PM
will bateson

Thanks Mark, hope you had a great day.

Oct 18, 2015 12:45 PM
Chris Shull
ColumbiaLand Realty - Columbia, SC
Your Realtor For Life!

Great perspective Will, I agree wholeheartedly! I look forward to reading more of your to the point perspective here on ActiveRain!

 

Oct 18, 2015 12:54 AM
will bateson

Thanks Chris.

Oct 18, 2015 12:45 PM
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

A better way to convey to home owners is the % of interest increase in relation to affordability. Until interest rates raises to 6.5% most Americans will not feel the subtle difference.  Mortgage interest rate was as high as 16.5% and people were still buying and selling homes.

Oct 18, 2015 02:33 AM
will bateson

Thanks Sam,


I think we're on the same page.

Oct 18, 2015 12:46 PM
Michael Thacker - Re/Max Real Estate Center - Louisville
Re/Max Real Estate Center - The Thacker Group - Louisville, KY
Your best friend who just happens to be a Realtor

Great first post, and great information to share!! Welcome to Active Rain!! 

Oct 18, 2015 06:32 PM
Mery Fernandez Empire Network Realty Luxury Brokerage
Empire Network Realty INC. - Orlando, FL
The Rise of An Empire, Let's Build Yours!

Hi Will!! Welcome to the world of Activerain, may your blogging  create a whole new chapter in your Real Estate Career.

Oct 19, 2015 12:43 AM
Crystal Kilpatrick
Team Leader -Crystal Kilpatrick Group - Austin, TX
CHLMS,CNE, CRS - Austin & Central Texas Home Sales

Welcome to Active Rain!  Thank you for sharing with us here.

Oct 19, 2015 04:40 AM
will bateson
Sidewalk Homes - Livermore, CA

Thank you all for the wonderful welcome, sounds like a great group!
Will Bateson, Broker
Sidewalk Homes (serving the Tri Valley)

Oct 19, 2015 04:42 AM
Stefan Winter
Real Estate in IL & NV | Owner of Real Estate Web Tech | Daily Vlogger - Las Vegas, NV
Owner - Winter Group & Real Estate Web Tech

Welcome to ActiveRain, I am not sure they will raise the rates either, they say they will everytime and they end up staying the same. Have a great week!

Oct 19, 2015 07:02 AM
Kathy Goldman
REVA Online | SEO Boost For Real Estate, Social Media Marketing for Real Estate and Real Estate Blogging Expert - Waukesha, WI
Social Media & Marketing for Real Estate

Hi Bill, You made a great point about balance in the housing market. It has been this way forever. You can still sell your home but it may be for "slightly" less because of the higher interest rate. If you write this out on a piece of paper for a buyer or seller, they can see there is very little difference!

 

Oct 19, 2015 07:23 AM
Kathy Goldman
REVA Online | SEO Boost For Real Estate, Social Media Marketing for Real Estate and Real Estate Blogging Expert - Waukesha, WI
Social Media & Marketing for Real Estate

Btw, welcome to ActiveRain. I am a Real Estate Virtual Assisstatn with 25 years of experience and am highly motivated to build relationships on AR.We are a great bunch, and even if someone does not necessarily agree, they don't have to comment!!! It's great! See my blog at www.REVAOnlineBlog.com

Oct 19, 2015 07:25 AM
Captain Wayne - Rowlett Real Estate School
Rowlett Real Estate School - Panama City, FL
Rowlett Real Estate School / Owner and Instructor

We have a bunch of numbers people here in the Rain that make pretty accurate predictions on the market, but your closing argument has just as much importance as the market if not more.

Oct 19, 2015 07:39 AM
Captain Wayne - Rowlett Real Estate School
Rowlett Real Estate School - Panama City, FL
Rowlett Real Estate School / Owner and Instructor

Welcome to ActiveRain, it's great to have you aboard.  I look forward to reading more of your blogs in the future.

Oct 19, 2015 07:39 AM
will bateson
Sidewalk Homes - Livermore, CA

Thanks Captain Wayne. Many years ago I was an economics major (and my dad a CPA) so I do like to analyze numbers.

Oct 19, 2015 07:46 AM
Nicole Doty - Gilbert Real Estate Expert
Zion Realty - Gilbert, AZ
Broker/Owner of Zion Realty ZionRealtyAZ.com

Do you know when the best time to buy a home is? When you need one. It doesn't matter what interest rates are ultimately. Houses will be bought and sold regardless. 

Oct 21, 2015 01:39 AM
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

While it is true that rising rates can have impact on some buyers .. and stall or derail a purchase, the other end of your equation is true too, will bateson.  

There are so many more pieces of the puzzle in home buying and financing these days.  And all too often those are overlooked or not given as much weight.  You prove why it's so important for hopeful home buyers to have an indepth conversation with their Lender well prior to actually looking for homes ...

Welcome to AR!

Gene

Oct 21, 2015 02:14 AM
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

Hi Will,

welcome to the Rain.

I believe that rates will go up just a bit next year, not much.

Oct 24, 2015 01:31 PM