Interest rates are rising. What if you want a house?

So you’re saying this time is different?

Yes and no. Events are ever-changing, even if economic cycles, stock markets, and housing are regular (if unpredictable or well-timed) events throughout our lives.

And, oh, we have a set of events. The pandemic and the government’s response have left many people spending less on travel, commuting, shopping for clothes, paying off student loans, and entertainment.

That leaves the checking accounts of people who haven’t lost their jobs or any income boosted. At the same time, the mortgage packages the Fed buys have helped lead to record-low mortgage rates.

That makes it easier for home prices to rise – just as many people are speeding up their moving plans to find more work space at home and keep their kids from having to do housework. There is even more competition for existing homes, and new homes take longer to build due to supply chain issues and labor shortages.

There’s more. Professional investors have bought homes – at an all-cash bid that most sellers prefer and most individual owners can’t match – like never before in 2021. According to Redfin , they have accounted for accounted for 18.4% of home purchases in the fourth quarter of 2021. In Southern and Western cities — such as Atlanta, Charlotte, Miami, Orlando, Las Vegas, and Phoenix — investors accounted for more than a quarter of sales. sell.

These institutional purchases are probably not made either.

“It was an absolutely terrible time to be a shopper,” says Sarah Ponder, a financial planner in Austin, Texas. There, the average house price has increased by 30 percent over the past year, according to the city’s Board of Realtors.

Ms. Ponder, who specializes in helping real estate professionals and has made five of her own property transactions in just 15 years of adulthood, points to one final X-factor: People her age He may not know who the rapidly rising interest rates affect. home buying psychology. Interest rates are rising. What if you want a house?

Fry Electronics Team

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