The real estate industry has seen extremely low interest rates for quite some time, but all of that may be about to change, and it’s driving a massive increase in buying activity.
According to a recent report from Freddie Mac, interest rates on home loans are expected to jump an entire percentage point in 2018 (from 3.9% in Q4 of 2017 to 4.9% by Q4 of 2018). That jump can mean a mortgage payment that’s hundreds of dollars more per month—and tens of thousands more paid in interest over the course of the loan. And according to a recent article from the team at Realtor.com, the threat of rising interest rates is pushing a new stream of buyers into the market. According to the article, potential buyers who were “on the fence” about buying are now making purchases in order to lock in lower interest rates, creating even more competition and driving up prices.