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Whether you are a buyer searching for your first home, or a homeowner looking to move up to your next home, you should pay attention to rising interest rates, decreasing inventories and increasing home prices.

Rising Interest Rates

In 2018, (due to the research of Freddie Mac), rates have increased from 3.95% in the first week of January to 4.40% for the first week of April.

With rates increasing, a buyer should take advantage of today’s lower rates! Experts believe that rates will continue to rise throughout the year and are expected to rise to about 4.48% by June. That average climbs to 4.73% by the end of this 2018.

How Could Rising Rates Affect You as a Buyer

Waiting until the end of the year to buy, with rates still projected to increase, will end up costing more money on your monthly mortgage payment. For every $250,000 you need to borrow, you will spend $49.21 more per month, $590.52 per year, and over $17,700 by the end of your 30-year mortgage.

Decreasing Inventories and Increasing Home Prices

There exists a myth that an increase in mortgage rates will cause a slowdown in home sales which would, in turn, lead to a fall in house values. Increasing home prices are determined by supply and demand. Rising mortgage rates may slow demand and, thus, affect supply.

A Buyer Needs a Real Estate Professional

As a professional, I am faced with questions regarding why a buyer would need me.  Here are one dozen reasons:

  1. Understanding the process.

There are essential steps to a successful closing.  They are:

  1. A fully executed contract with all important facets initialed.
  2. Buyer applying for the loan timely with the contract deadlines.
  3. Lender deadlines met according to TRID.
  4. Buyer purchasing insurance with the binder in place by closing.
  5. Loan Approval.
  6. Walk-through and signing off.
  7. Review of the Closing Disclosure and/or HUD.
  8. Title company’s involvement and advising of the wiring of funds.
  9. Handing over of keys, clickers and keys to the clubhouse.
  10. Registration with the water company as well as other local utilities.
  11. Registration with the HOA or COA.
  12. Pointing out the “not-so-obvious” features regarding the property.
  13. Negotiating better contract terms.
  14. Providing buyers with “tried and true” service vendors.
  15. Improving knowledge of the areas – so a buyer makes an informed decision about where to live, work and play.
  16. Obtaining knowledge of home values and how to calculate them.
  17. Providing education as to the market.
  18. Addressing challenges that may arise.
  19. Overcoming objections.
  20. Possessing effective negotiation skills.
  21. Planning strategically. A plan, a timeline, and the setting of expectations.
  22. Being a trusted advisor for new construction.

With rising interest rates, decreasing inventories and increasing home prices, a buyer would best hire a Real Estate professional because working with a professional costs a buyer NOTHING.

Buyers and Sellers:  Work with a professional with knowledge of the area and the market as well as a proven track record for success.