Tuesday, December 14, 2010

Can Rising Mortgage Rates help the Market?

Mortgage rates are at historic lows, so it must be a buyers paradise right?  Not so fast says an interesting piece from Rick Newman at US News and World Report.  "Rising mortgage rates will scare off some buyers, such as bottom fishers or those who can only marginally afford to buy. But they could motivate others who might feel a newfound sense of urgency to lock in rates that are still remarkably low."

With so much uncertainty in the last few months, combined with a general feeling that rates have to start rising soon we think this is a pretty smart take on how buyers will behave.   There have been a lot of buyers on the sidelines paralyzed by uncertainty and nothing gets people motivated than the fear that prices are rising.

 For sellers this means moving fast to get ready for the January selling season when home buyer come into the year with a new sense of urgency.