What Do Low Interest Rates Mean For Me In Today's Market?
What do low interest rates mean for you in today’s market?
The world is crazy right now, but one of the craziest things is how insanely low interest rates are! In September, rates on a 15-year fixed rate mortgage were as low as 2.39%! That begs the question then, “what does this mean for me as a buyer or seller in today’s market?”. Well, we have some insight into that for you!
What do low rates mean for me as a buyer?
As a buyer, low interest rates are great! They help increase your budget a bit and mean that you’ll end up paying less over the long-term life of your loan. Something to note however, is that with lower rates, you typically end up paying discount points. Discount points are an upfront fee that you pay for a lower overall interest rate. In the grand scheme of things however, even by paying points you usually pay far less than you would over the long term. The combination of paying some discount points for a lower rate is a great way for you as a buyer to have a better opportunity to make a strong offer on a property that you may be interested in. For more information on rates, discount points, etc., consult a loan officer (if you’re in Michigan, we have a couple we would love to recommend!)
What do low rates mean for me as a seller?
Low interest rates can be a seller’s best friend. Lower rates typically mean that people are more open to making the big commitment of purchasing a home and also maximizing their budget. With interest rates as low as they are, now is a great time to get your house on the market. Things are moving quickly and for top dollar. However, if interest rates go up, you can expect your home to sit on the market a bit longer. Buying a home is a big decision for people, it involves a lot of emotion while also being incredibly real about finances. The higher the interest rates the more averse or cautious people are when it comes to buying. As a seller, making sure you put your home on the market during time periods with low rates is one of the best things you can do! In order to make sure your home is priced appropriately, consult a local real estate agent to make sure you are pricing appropriately and getting the best deal possible.