How have low interest rates affected the real estate market?
There is some concern that interest rates my increase over the next 6-18 months and that may cool the real estate market. However, most people we’ve spoken with such as mortgage brokers, economists and top real estate agents alike, would disagree with the aforementioned statement. They are not attributing the growth of the real estate market to the historically low interests. There is no doubt that low interest rates have helped the overall economy but when it comes to real estate, we’ve had our eye on other factors fueling demand such as baby boomers relocating, being able to work from home and low tax, good weather areas drawing more attraction as COVID caused homeowners to reassess their housing needs.
With some first time homebuyers, lower interest rates have helped them with the affordability of a first time home no doubt, which may have caused prices to rise some but it is not a key indicator. Moving forward, rates will begin to rise, but we do not expect this to have a large impact on the real estate market.