Are fluctuating rates a bad thing?
It finally happened this month. An unwelcome jolt if you (or your client) is in the market to buy a home.
What happened? Rates went up.
But then they rebounded. Quickly.
The last couple of weeks have been a steady display of small percentage points inching up and down, leaving many of us in the mortgage business to wonder where this post-COVID market is heading.
After more than a year of feasting on rock-bottom mortgage rates, some buyers have gotten a little complacent with expectations of being able to get a historically low interest rate.
So for the first time in over a year, we’re facing some uncertainty in the market.
Here are 3 reasons why fluctuating rates are nothing to be concerned about.
Reason #1: Catching Our Breath
Some of my referral partners in real estate have made a fair chunk of money over the last year largely thanks to low mortgage rates. But there have been side effects.
It might have been exhausting. And if it weren’t for quarantine rules, you probably wouldn’t have seen your family or friends much over the last year.
Riding a wave of record months is great for your bank account. Not so much for quality of life.
Reason #2: Markets Stabilize
The rapid increase in prices over the last year has been nothing short of crazy. It almost feels like the years leading up to the crash in 2007 (if you were in the business then).
Both situations relied on outside factors to create market conditions that weren’t sustainable. A bit of that is going on here.
We’re looking forward to the real estate market finding a nice middle ground to support long term values while fostering responsible homeownership and investing.
Reason #3: Being Professional Matters
Low interest rates attract price-oriented people to the market on both sides of the equation. More realtors, more mortgage lenders and more buyers. All of them focused on cheap rates.
The emphasis on low rates and a rapidly accelerating real estate market has taken some of the emphasis off of what matters most:
handling real estate transactions with integrity
attention to detail
keeping the borrower's best interest in mind
I’ve always believed that being professional is my most important duty as a mortgage lender. Our referral partners like you believe the same thing.
That’s why we’re looking forward to the market slowing down a bit, because when the market gets a little tighter, professionals always win!
Let’s Connect
Don’t worry… we’re not rooting for interest rates in the 9s again. We’re just looking for a stabilization to the feeding frenzy that has been the last year.
We’d also like to connect with you when you have a free minute.
Drop me a line back and tell me what you think is on the horizon for this year in your business.