Interest Rates and Real Estate - May 2022
Interest Rates in Austin, Texas for 2022
Are buyers out of luck? Let's talk about interest rates. If you'd prefer to read the information, the transcript can be found below the video.
5% Interest Rates Greetings! In a very short period of time, home loan interest rates have climbed to about 5% for a 30-year loan. While this is still a great rate in historical terms, it is certainly not a low rate for recent history. Rates briefly approached 5% in 2018, but otherwise you need to go back to 2009 to find rates this high. So what will happen to home sales and prices? When, here in Central Texas, I expect it won’t have much impact. I believe the great demand, both pent-up and future, is more powerful than 5 or 6% interest rates. Sure, a buyer who planned to spend $800,000 may now have a max price of $750,000, but they are still going to buy a home. As long as inventory stays relatively low, I expect prices to continue to rise, but at a slower pace than we’ve seen recently.