What is Coming in the Real Estate Market and How Does it Affect You?
As most people have heard, the real estate market has experienced all-time highs recently. This spring, most homes in Sterling and Princeton have been selling over the asking price with multiple offers and bidding wars. This was the craziest spring market I have ever seen. What does this mean for you and how do you plan for the future? Depending on when you purchased, the value of your home has probably increased as well. Even if you are not interested in selling right now, you can use the higher values around you to refinance your home or get a home equity line of credit to use the equity in your home for projects or other expenses. Now is a great time to talk to your lender about taking advantage of the equity while home values are high.
If you are still interested in selling or buying a home but wondering what the market is going to do, you are not alone. I have had many conversations with homeowners in Sterling and Princeton worried that they missed the market and would have trouble selling now that the interest rates have increased. The good news for sellers is that we are still experiencing such low inventory in our towns that it is still a great time to sell your home. There are buyers that have been unable to compete in this market and are still looking for their dream home. This means we still have buyers actively looking for homes in this area.
But interest rates do affect the market. I have had more than one buyer need to reassess what they can afford when the buyer’s rate increased. When listing your home, it is important to make sure your selling agent has talked to the buyer’s lenders and determined there is no change in preapprovals due to the rate increase before accepting an offer. You don’t want to accept an offer from a buyer only to find out they can no longer afford to buy your home because their preapproval was a week old.
If you are a buyer, you want to call your lender and have them run your numbers again to make sure you still qualify for the amount you were told and that you can still afford the monthly payment with the recent rate increase. Buyers are often relying on preapprovals that were 60 or 90 days ago and there is a lot that has changed in the past 90 days. Not only should you talk about the rate increase, but I see too many buyers using the maximum amount available without really knowing if they can afford the montly payments. Have a good look at your finances to determine where you are comfortable before making an offer.
It is still a great time to buy or sell a home . I expect we will still have a good summer market. It is important to have a good plan and be prepared. Only an experienced real estate agent can help guide you through the process of buying or selling in this changing market. Find an agent you trust and meet with them to discuss your home ownership plans. If you have any questions, please feel free to contact me at firstname.lastname@example.org or 978-407-2568.