Waiting for Rates to Fall Might Not Save You Money, According to This Shark Tank Expert

Blog posted On May 16, 2024

Thinking about waiting out the higher-trending rates? You’re not alone. Many home buyers are sitting on the sidelines, eagerly waiting for rates to fall. Most assume that if they wait, they’ll save money. But this might not be the case. In fact, it could end up costing them more in the long run.

The calm before the storm

Existing home sales, which account for roughly 90% of total home sales, slipped 4.3% in March. The housing market has been notably slower recently. But the pace (and the competition) is expected to pick up when rates trend lower. Right now, fewer homeowners are putting their homes up for sale because they don’t want to lose their current rate. And fewer buyers are looking because they’re waiting for lower rates.

Careful what you wish for…

While it may seem like lower rates will solve all your problems, it may not be all sunshine and roses. Think about it: if everyone’s waiting for lower rates, what’s going to happen when they actually fall? A lot of buyers have the same idea. Which means you won’t be the only one looking to buy when rates finally cool. Competition will increase, bidding wars could rise, and home prices “are going to go through the roof,” said entrepreneur and Shark Tank producer, Barbara Corcoran.

Corcoran’s housing market predictions

Corcoran has made quite the name for herself in the real estate industry. In fact, ever since she built the largest residential realty in NYC, people have often referred to as the Queen of New York Real Estate. Through her years of experience, she’s gained valuable insight and has an “enviable track record of being dead on with her predictions,” wrote Crystal Mayer of Yahoo Finance. Her latest prediction? The minute that interest rates go down, “all hell is going to break loose, and prices are going to go through the roof.”

What to consider moving forward

Corcoran certainly has good reason to believe her prediction. Historically, lower rates bring more buyers into the market, and more buyers means more competition, which tends to drive up prices. However, it's important to keep in mind that price trends tend to vary by location. What happens in the New York City market may not happen in the West Virginia market. That being said, there are a few steps you can take to see if buying now or waiting is a better option.

1. Evaluate your finances to see if you’re financially ready to buy now
2. If you’re concerned about rates, ask us about Rate Rebound
3. We can walk you through a buy now vs. wait scenario with predictions to compare costs
4. Bottom line, reach out and we can help you determine if buying before the ‘storm’ is the right move for you!

Source: Yahoo Finance