Is this the right time to buy real estate? Yes. Why? Interest rates are low and they are going to go up at some point. And this will affect the “cost” of a home, the monthly payment. And what buyers care about is cost, explained Steve Harney, a 25-year real estate veteran and the closing session speaker at the IAR Convention. He received a standing ovation from the packed crowd of Illinois REALTORS® in attendance as he told them they can’t rest.
Harney said the positive momentum of the last five months in housing has not brought us yet to a turning point in the market. Foreclosures and an anticipated supply of homes coming on the market for sale will continue to put downard pressure on prices. And this is important information for sellers related to setting the right price to sell.
He shared a graph from Freddie Mac that showed the interest rate trend line: interest rates have risen higher than where they came from in three out of four times over the last six years. Since October of 2008 interest rates have fallen 2 percent. So, if the trend continues, rates will rise as much or higher from where they are now (at record low levels – hovering near 5 percent). Harney said: “Let’s get back to work and keep the momentum into spring.”