{"id":3695,"date":"2022-12-05T13:00:00","date_gmt":"2022-12-05T13:00:00","guid":{"rendered":"https:\/\/preprod.realtrends.com\/blog\/2022\/12\/05\/how-should-real-estate-agents-discuss-mortgage-rates\/"},"modified":"2025-03-13T02:48:03","modified_gmt":"2025-03-13T02:48:03","slug":"how-should-real-estate-agents-discuss-mortgage-rates","status":"publish","type":"post","link":"https:\/\/preprod.realtrends.com\/blog\/2022\/12\/05\/how-should-real-estate-agents-discuss-mortgage-rates\/","title":{"rendered":"How should real estate agents discuss mortgage rates?"},"content":{"rendered":"\n

At the beginning of the year, interest rates were at an all-time low. It was a sellers\u2019 market with buyers competing for homes that would sell for way above the asking rate.<\/p>\n\n\n\n

More recently, the Federal Reserve has raised interest rates<\/a> to counter inflation. The increase has some buyers getting cold feet<\/a>. The market has slowed considerably.<\/p>\n\n\n\n

Real estate agents are still in a good position to buy and sell, but they must take steps to make buyers feel comfortable proceeding with their transactions. This article will tell you how to approach the conversation so you can remain lucrative amid the rising rates.<\/p>\n\n\n\n

Mortgage rates are rising<\/strong><\/h2>\n\n\n\n

Inflation is going crazy. With gas prices and food prices rising, the Fed had little choice but to raise interest rates. Interest rate increases mean people spend less making for reduced demand which forces companies to drop their prices for goods and services.<\/p>\n\n\n\n

But are the feds taking it too far? They have raised mortgage rates in both June and July by .75% each month making for a rapid increase that hasn\u2019t been seen since the 1980\u2019s. They add to two previous increases making for a total of four increases this year alone.<\/p>\n\n\n\n

Each .25% increase means an extra $25 on every $10,000 you have in debt. So, the .75% spike translates to an extra $75 interest for every $10,000 in debt. The four 2022 spikes combined equal a 2.25% raise in total meaning homeowners are now paying an extra $225 in debt.<\/p>\n\n\n\n

The rising rates are keeping many would-be buyers in their apartments. They are also negatively affecting the stock market. They are boosting loan payments on cars and credit cards as well.<\/p>\n\n\n\n

What\u2019s more, many people fear there will be a housing crash. Although measures are now in place to prevent this from happening, such as higher standards for loan approval, it does little to allay fears. This is further fueling the market slowdown.<\/p>\n\n\n\n

Buying is particularly difficult for first-time buyers who don\u2019t have equity in an existing home.<\/p>\n\n\n\n

How higher interest rates change how you approach a conversation with buyers<\/strong><\/h2>\n\n\n\n

While the increasing interest rates are concerning, there are still many bright sides to the market. And bringing these up in conversations with buyers could make all the difference when it comes to them making the decision to sell. Here are some key points you should be touching on.<\/p>\n\n\n\n