Why High Interest Rates Aren't Bad News After All

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Do you know that the perfect time to purchase a new construction home is actually when interest rates are high?

If you haven't noticed before, construction materials become cheaper as interest rates increase. That's because producers gain incentives when they provide more supply. So even if the demand for new home construction declines, they will continue to produce raw materials such as steel and concrete.

With cheaper materials, plus a limited number of homebuyers in the market (as most will avoid the high interest rates)—developers with thin profit margins tend to offer aggresively low prices. This happens too often with local developers, because they are pressured to meet overhead expenses during a period when income is not so good.

Here's a tip from Warner Robins area expert Anita Clark: Contact developers to get an estimate of their base cost. This is the amount they spent on constructing a new home. Add in the cost of all home upgrades you want to make. The total will be the budget you need to prepare before you sign a contract.

If you're considering to buy a new home, make sure you read her latest blog post: https://sellingwarnerrobins.com/7-ways-real-estate-consumers-can-capitalize-on-high-interest-rates/ She has more tips in it that will surely help you avoid throwing your hard-earned money into a property you'll eventually regret!



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Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Katerina. Having experienced rates of close to 20% plus 3 points, interest rates do not concern me. People need to buy and sell when they need to and the market adjusts! These days rates should have everybody making a move!

Dec 13, 2018 05:22 AM #1
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good morning Katerina Gasset - that is really and interesting analyis.  If so you can always refinance when rates are lower.

Dec 13, 2018 06:50 AM #2
Anita Clark
ColdwellBanker SSK Realtors ~ 478.960.8055 - Warner Robins, GA
Realtor - Homes for Sale in Warner Robins GA

Thanks a bunch for the shout-out, Katerina. I hope your readers benefit from the information in the article.

Dec 21, 2018 05:26 AM #3
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Katerina Gasset

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