Three Reasons To Persevere Through Rising Interest Rates

By Ryan Stansbury

A mere nine months ago, buyers were enjoying interest rates sitting comfortably under three percent for a 30-year fixed mortgage. But with the Fed pulling out the stops to combat inflation, rates have spiked dramatically. With current rates sitting above six percent and many forecasting their continued rise through the remainder of 2022, many buyers are wondering if they should change their plans to purchase their dream home until things cool down. While every buyer’s situation calls for a unique strategy based on their particular financial circumstances, here are three reasons why buyers should consider sticking with their plans despite rising interest rates:

1. Great investments take a long-term approach.  
If I could show you that an investment today would ensure a solid long-term return, would you be interested? Of course, you would. Even if that investment required paying a premium, as long as the investment was secure, you’d likely still be interested. When good investors see long-term value, they don’t shy away, even if it means paying an initial premium for entry. The steady gains we’ve seen in the DMV market will continue despite the current uncertainties.

2. Your competition is getting scared off.
When markets change, people get scared. We saw this in an extreme way at the beginning of COVID. The stress was so high that almost everyone stopped their searches. For the person who stays in the market, though, a market change can signal the opportunity to snatch up a deal with far less competition.

For folks who wait on the sidelines, identifying the “perfect” time to buy becomes as hard as guessing when a stock will hit bottom. Staying in the game becomes the game in a market shift.

3. Off-market opportunities are coming back.
As demand wanes and properties take a bit longer to sell, a new sense of uncertainty is starting to grow with sellers. Whereas not going to market would have been folly a year ago, with unprecedented bidding wars pushing up prices, now sellers are willing to think about alternatives to the standard online listing.

For those with the strategy to find them, off-market deals are a perfect option for buyers to give sellers certainty and even money-saving opportunities by avoiding the need to prep their property for market.