I had a wonderful experience this Friday morning talking with Nikki Kimbleton with Jacksonville's Channel 4 News. The TV station asked me to discuss about how the recent hike in interest rates might effect potential home buyers' ability to make a new home purchase. We also talked about whether or not it's a good idea to search for a new home during the holidays. Here are some of our main talking points:
- When the Federal Reserve increases interest rates, those changes don’t usually effect mortgage rates immediately. And, interest rates are only one factor in people’s decision to buy a home — many other factors are important too.
- The changes in interest rates might effect adjustable rate loans (APR) right away if those loans are scheduled to re-set.
- Interest rates for mortgages are anticipated to creep up slightly in 2016 and 2017, but remain remarkably low when you consider the big picture. Rates haven’t increased in over 10 years — so we actually have a whole generation of home buyers who are accustomed to really, really low mortgage rates.
- The average days a home is on the market can vary dramatically depending on the price of a house. The more expensive a property, generally the longer it might take to sell the house.
- For listings in Northeast Florida the average days on the market is 87 days. But, for homes that are priced over $1,000,000 the average days on the market is 137 (over 4 months). For very high-end custom homes, over $2 million dollars, the average days on the market can stretch out to years because those buyers are also considering building a new home.
- When deciding on a sale price for your home, it’s critical that home owners and their real estate agent carefully consider the recent sales in the neighborhood to determine an appropriate price before putting the house on the market. To see the interview click here.