It is the news we have been waiting for. Many of us have talked about how interest rates will go up “soon”. And almost for a decade, we have waited and anticipated. It finally did. The Federal Reserve raised 1/4 point yesterday (December 16 2015) after reviewing the strength of the economy, the housing market along with the strong dollar.
The Federal Reserve raises and lowers rate to curb inflation and to stimulate the economy in the positive direction.
There are some benefits to this recent interest rate hike:
- Savings rate will increase a little – It’s been a long while since we’ve since interest rates we could be excited about.
- Credit becomes less available, therefore slowing the economy down. The stock and real estate market will under-go an interim volatility but the long-term effects would still be unknown. Only time will tell.
- From the Prosper, Frisco real estate market perspective – This will perhaps help “on-the-fence” buyers get off the fence – if the rising prices of Frisco and Prosper TX home sales prices have not create the motivation.
Mortgage Rates Play Role in Housing Market
Should I be concerned now that interest rates have gone up?
Interest rates up or down affects an individual to purchase real estate with mortgage. The cost of mortgage goes up, there is less credit available. No other sector is profoundly as impacted as the housing market with the ultra-low interest rates for years. On a $225,000 home, the increase of a 1/4 point is $26. It is not earth-shattering.
Instead of focusing on mortgage interest rates, as a Frisco TX real estate broker, my advice is to focus on purchasing a Frisco Texas home sooner rather than later. The rising house prices increase much faster than the small interest rate hike increase.
I’d love to help you achieve one of your goals in #2016 – ie. to purchase a Frisco TX or surrounding area homes! Call/ text (214) 783-2210 or (214) 529-6003 to begin this home buying process.
