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I've spoken with a number of prospective buyers, and all of them have one or both of the following issues of concern. First, they are concerned about interest rates going up. My own argument is that rates can only go up as far as the markets will let them. At some point people are going to ease up on demand for loans.
The only time the Fed ever tried to raise rates to cut off demand was in the early 1980's in an effort to choke off inflation. With my other hat as a History teacher, I would argue that raising interest rates was a coincidence. The inflation of the 1970's was substantially due to President Nixon taking us off the gold standard "cold turkey". That caused a massive correction in the value of the dollar and that was the major cause of the inflation.
It's history now, but the point is that the market is a force in interest rates, and banks and the Fed still have to make a profit. So if you're considering buying a home now, you sould be more concerned about present rates and what you can afford, rather than trying to predict the future.
The second issue is demand. Until recently, there were a lot more buyers than sellers. I've helped successfully market homes when the seller initially thought they were "under water" and there was still a housing recession. That is correcting, and now there's more of a balance. But for awhile in the Maryland/ DC/ Northern Va. market, it was difficult to get a home in the $200,000 - $400,000 range. There was a lot of demand, and multiple offers on homes within days of coming on the market. I helped a very nice lady and her grandaughter find a home almost two years ago. We looked for about a year and submitted around 15 contracts before we actually landed a home.
The fall is a better buying season for the buyer, there really is less demand once school is in session. If you are a seller, you should expect to take awhile to get the price you want, or you're probably going to have to come down in the price you settle for. So buyers, this is a better time for you.
Find a good agent, and happy home hunting!
The Washington area has always been a strong real estate market, even during 2009 and 2010 there were still steady home sales. Today the market is very strong, with good prices for both buyers and sellers.
An interesting part of the market are multi bedroom multi
bath single family and townhouse homes around $300,000 and below. Very
few of these are currently being repossessed by banks, most current
repos are a year or more old. Distressed homes are being bought, often
for cash, by investors looking to either rent the homes or renovate and
sell for a profit.
Mortgage rates are
low too. A lot of people are
afraid of escalating mortgage rates once the Fed starts moving this
fall or winter. I would beg to differ, the Fed can’t simply and
arbitrarily raise rates.