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Buying or Selling?

Brought to you by Jerry Fisher - RE/Max equity group - REAL ESTATE INSIDER

RE/MAX EQUITY GROUP - Jerry FisherIf you're thinking of buying or selling a home this year, you may want to speed up your plans. With current interest rates increasing nearly a half point since November and expected to rise steadily throughout 2017, your purchasing power and selling potential are going the opposite direction.

The low rates we experienced the past few years enabled more people to qualify to purchase a home. This increase in demand reduced the supply of homes on the market which then pushed up home prices. But as rates rise, the opposite occurs. Fewer people qualify for a loan, the supply of homes on the market increases, and pricing tends to lower.

Both buyers and sellers can be affected by rate increases. For example, a first-time homebuyer using a low down payment FHA loan to purchase a $300,000 home would have paid around $1500 a month for their mortgage in November. Today that same home will cost about $100 more per month and it will possibly cost $200 more by midyear. And for sellers, there may be fewer buyers in the market as rates increase. This could mean homes for sale will be on the market longer and motivated sellers will have to lower their pricing.

But don't fret, interest rates are still at historic lows. It's a great time to purchase or sell a home. But it appears that waiting may have costly consequences.

Jerry Fisher, RE/Max equity group

255 SW First Ave, Canby, OR 97013

503-989-0570 or 503-266-4747