An unexpected mortgage rate drop benefits buyers, but for how long? We had a temporary inverted yield curve, which means long-term rates were less than short term rates. 30-year mortgages are most often pegged to the 10 year note, and when the yield curve inverts, it throws the market into bewilderment.
There were fears of slowdown and recession, which led many to believe perhaps the Fed was overzealous in raising rates this past year. Then earlier this week, global economic news started coming in stronger than expected, which set recession fears at ease.
Earnings are due out soon and the thing to watch will be guidance in these reports. Couple that with listening to what the Fed indicates, and the interest rate uncertainty may start to clear up. Therefore, we don’t know how long this drop in rates will last.
What we do know is buyers should not squander this opportunity. Last week we saw the largest and fastest rate drop in history in a week. Rates are down almost a full percent since last Fall, and about ½ percent since January. A buyer today qualifies for about 11% more home than they did 6 months ago. The best part is, not only do they qualify for 11% more, it won’t cost them to borrow 11% more either.
Buyers should lock-in rates right away. If your lender allows you to lock and shop, that might be a good idea. If they don’t, get your home under contract and make loan app right away. Waiting to purchase could cost you much more in interest than you could ever save negotiating with a seller. Get your negotiations locked up today so you begin the mortgage process.
Sellers, you’ve got a tight window too. More buyers just entered the pool that can qualify for your home. If rates go back up, that pool will dwindle to what it was last week. Don’t bet on the fact all buyers will read this story. By the time home buyers figure this out, it might be all over. We just don’t know where rates are headed, and neither does the market. We are in uncertain times, but rest assured, the market will figure this out.
The Ellis Team still has 20 pending sales, even after the big 1st quarter we had. With the interest rate drop, we’re looking to add to this number. We’re down to just 11 homes and condos on the market right now. Everything else is pending or sold. We need listings. Our marketing is working.
Sellers are astounded when their listing expires to find out there is a difference in marketing. The perception is all Realtors work the same. Just list it in MLS and on all the websites, and it will sell. That’s not marketing at all. Any Realtor can do that. That’s the bare minimum. That isn’t what’s going to sell a home.
Unfortunately, too many Realtors have sold the idea that having sellers’ homes listed on all these platforms will sell a home. The truth is they do this because it’s Free. That’s right, it typically doesn’t cost the Realtor anything to list a home on all these portals. What isn’t Free is the lead generation and finding buyers for the properties. There is a reason the Ellis Team sells so many homes. It’s because we don’t take the Free route. We spend a lot to create these buyers for our listings, and we have people on our team to work them.
If you’re thinking of selling, call Brett or Sande Ellis 239-489-4042 Ext 4, or visit www.SWFLhomevalues.com If you’re looking to buy now at today’s low rates, check out www.LeeCountyOnline.com or call our office and we’ll get you locked in to a good deal and low rates today. There is still a good selection of homes on the market right now, even if they’re not our listings. We’ll be happy to find you the best values.