Tuesday, November 15, 2016 / by Matthew Biggers
Higher rates lowers the price buyers can pay and sellers can sell for
I’ll cut to the chase. For every 0.5% (one-half percent) rise in mortgage interest rates, buyers purchasing power decreases 4-5%, and if it spikes by a full 1% it results in a 9-11% decrease in buyers purchasing power.
Now before you freak out, know that in the grand scheme of things 0.5% is a blip on the radar, granted a costly one if you want to buy a nice home or sell your home to the widest pool of buyers. But when you couple this rise with the fact that the only reason the Federal Reserve postponed rate rises to far was because of BREXIT and that the Fed shows ...