When the interest rates go up, do not panic! All this means is a shift in monthly payments. The real estate world has it's on own ecosystem which means if something increases then another will decrease.
Let's take the housing market during Covid Pandemic as an example. The interest rates were at an all time low BUT the house sale prices were higher than ever. Lower interest rates equals more buyers AND more buyers equals more competition. Evidently we saw bidding wars take place, leaving buyers to spend more than listing price.
This same example can be applied to our market nowadays. With the slight increase in the prime rate, by way of trends it'll lessen buying activity which reduces competition and allows buyers to be more successful purchasing at a lower price.
Long Story Short:
- Less Competitive Market
- More Affordable Prices
This means you won't see as much bidding wars, more inventory on the market to choose from and house prices will generally go down to combat higher interest rates.
Hope this helps! If you have anymore questions feel free to reach out to me at 204-894-1653 or contact@marcnirzare.com