Nobody likes dealing with mortgage interest.It’s not something that we want to deal with, but it’s a necessity. If you want to buy a house which is one of the largest purchases you’ll ever make, you’ll have to deal with mortgage interest. Interest rates are one of the largest factors when it comes to buying a home. They’re one of the most pivotal and important factors when it comes to purchasing a home, especially in Atlanta. But when these rates go up high, reaching eight per cent or more, it’s difficult to tell whether or not you want to sell your home. If you’re in a high interest rate location and you’re considering selling your home, there’s a lot you need to think about first. Let’s take a look at the most important factors for you.
Here are the Cons of selling with a High Interest Rate:
- Limited Clients and Buyers: When interest rates go up, mortgage payments will also go up.Many home buyers won’t want to purchase a home if their mortgage payments are going to be higher than they like. You’ll have a much smaller buyer pool, and it could potentially be harder for you to get the price you want for your property. Keep in mind that if you have a buyer who is willing to refinance later, they’ll still purchase your home.
- More Time on the Market: Less demand means more time on the market. It’s pretty self-explanatory why having your house on the market for a long time is a negative, but to help spell it out, you’re paying more fees. You’re paying taxes. The longer that that property is in your possession, the more money you’re losing. Not to mention if the market starts to dip while your house is still on it, you’re going to be making a little even less, which leads us into our next points.
- Possible Price Drops: Less demand can mean your house is worth less.if your house isn’t selling and other houses in the area are also staying on the market, you might have to lower the price just to get it sold. While you might want to get that perfect price for your home if it stays on the market too long, that’s not realistic.
- Missed Investments: If you’re sitting on a home and you don’t have the cash from its sale, you’re not going to be able to invest in other markets. Interest rates going up can sometimes be indicative of other markets or other businesses being more lucrative than normal. Lowering your price to sell that house might be necessary if this is the case.
But, let’s take a second to look at some of the Pros to selling your home in a market with a High Interest Rate. We’ve got a few for you:
- Bigger Down Payments: High interest rates might be off putting for some buyers, but those who are still in the position to buy are going to be much more financially prepared. With more money in their pocket, that’s more money you’re going to be putting in your pocket.
- No Window Shoppers: You’re going to have significantly less buyers that are just trying to shop the market and look around.You won’t have people who will waste your time seeing the prices, or haggling with you, or who have multiple homes that they’re looking at. If there are high interest rates and someone approaches you about buying your home, they’re more than likely much more serious about purchasing it.
- Great Rental Potential: If you can’t immediately sell your home, converting it into a rental is a great decision. With higher interest rates for purchasing a home, the demand for rentals will increase significantly for people trying to avoid that extra fee. Changing a home sale into a rental not only gets you money, but keeps the property in your name for further investment. If you’ve got the time and energy to manage rentals, it’s a great choice.
- Investment Potential Elsewhere: If you can sell your house at a high interest environment, you can end up with a lot of capital for other investments.If the housing market near areas looking more bleak, a quick sale can prevent you from having depreciation on your home. Money in your pocket is investments elsewhere, so you can build your money more effectively in a market that isn’t suited for selling homes.
Interest in short selling your home when interest rates are 8% or even higher, can be a tough choice. At the end of the day, it’s one that only you can make for your home. While there are a lot of opportunities to consider, there’s just as many challenges to selling your home in a high interest rate market. It’s important for homeowners to not only understand the real estate market, but to talk with professionals who know what’s going on in the metro Atlanta area. It’s important to not look not just at the short term, but the long term effects of selling your home in a high interest rate market. Luckily, at Christian Buys Houses, we’re here to help our clients with the best information. We can help you decide whether to try to sell your house, tugged into a rental property, or if you want to make it easier, we’ll even buy your house for cash as is. If we buy your house, it’s as simple as can be without having to worry about any of the hassle fees or work that go into selling a house normally on the market. Take a look at our home buying process, and we’ll help you sell that home, whether it’s to us or someone else.