Rates are up. So what does that actually mean for you?

Mortgage rates have been moving up again. We’ve seen this before, and the Phoenix market has continued to move even when rates are higher.

What I’m paying attention to is how buyers respond when rates are moving around. Moving rates cause Uncertainty and that is what tends to make people pause, even when the actual rate may only be part of the decision.

If you’re buying, a higher rate means a higher monthly payment. 

But the rate is only one part of the equation.

There are several ways buyers can offset a higher rate, including seller-paid closing costs, temporary 3-2-1 buydowns, permanent rate buydowns and lender incentives. The right option depends on your loan, how long you plan to own the home and what the seller is willing to negotiate.

When some buyers step back, 

the buyers who remain have more negotiating room.

In the Phoenix market, I’m seeing opportunities for buyers to negotiate seller-paid closing costs, rate buydowns, price reductions and significant repairs.

That doesn’t mean every seller is offering $10,000 in concessions. It does mean buyers should be asking what is available before assuming the asking price and mortgage rate are the only numbers that matter.

We bought our home last year when rates were around 7%. When rates came down, we refinanced to 5.99%. 

Rates matter to sellers too, because they directly affect what buyers can afford each month.

Right now, buyers have options in many Phoenix-area neighborhoods and price ranges. That affects how they negotiate, what they are willing to pay and how quickly they move on a home.

That’s why pricing correctly from the beginning is important.

That doesn’t mean you should underprice your home. It means the first few weeks on the market matter, and overpricing can make it harder to get the right buyer through the door.

Rates will continue to move and buyer demand will change with them. The impact will be different depending on the neighborhood and price point.

If you’re buying or 

selling right now

I wouldn’t make the decision based on the mortgage rates alone. Look at the price, the monthly payment, the available incentives, the competition and your own timeline.

Those numbers tell you more.

Remember, purchasing real estate is looking at the long game and your longer term future goals and how a purchase or sale fits into that.

If you’re wondering what that looks like for your particular home or situation, reach out. 

I’m happy to talk through the numbers with you.

Melanie