The Federal Reserve has recently made their first ever interest hike in almost a decade and this is highly significant news for Northern Virginia real estate buyers and sellers, Digital Journal reports.
During the financial crisis in 2008, and with the crashing of the real estate market, the Federal Reserve had no way but to dramatically drop the interest rates. Now, after seven years, they are raising the rates and this new federal policy is expected to affect North Virginia's real estate market.
Real estate owners in North Virginia will now set their eyes to Spring of 2016 as the most ideal time to sell. Considering present factors, now is also high time to sell and the recent changes have certainly added fuel to the fire.
"The increase in rates really means 2 things if you're thinking of selling your home. Number one is that the increase in rates will get a lot of buyers who have been been on the fence about buying a reason to purchase now, which means that right now you will have a much buyer buyer pool looking to purchase now before the rates go up any further. Number two is that when interest rates go up, it can have an effect on the price of your home because buyers qualify for less." He continues by saying this means that "now is the absolute best time to sell before rates go up and prices come down further," says Mike Putnam, who is an expert in North Virginia real estate and who is also behind the book "5 Ways to Sell Your House Fast".
The recent interest hike is most probably going to shape the market and is also going to make the prices continue to go higher, according to several economists and real estate experts. Putnam says, "We are expecting that you will see 2-3 small rate increases throughout the year. Most increases will be around a quarter point." But he clarifies, that "Even with these small increases interest rates will still be historically low" which means that rates are still low despite the increase.
"One of the biggest trends we are seeing is that inventory has dropped almost 50-60 percent from just 3 months ago," says Putnam when asked specifically about the North Virginia real estate market. This means that now is a good time to sell or consider dropping thousands for an upgrade.
With the rising rates, buyers are motivated to buy more than ever. "With the increase in rates you have a much bigger buyer pool who are motivated to buy Northern Virginia Real Estate Now," Says Putnam.
