Will Rent Drop With Higher Interest Rates?
I am looking at becoming a landlord, and am worried that rent will drop with higher interest rates. Is this thinkng correct, or will rental rates go up, down or stay the same???
I am looking at becoming a landlord, and am worried that rent will drop with higher interest rates. Is this thinkng correct, or will rental rates go up, down or stay the same???
higher interest rates means property values decline..that can mean rent will rise or drop depending on the market..theres no standard around the nation..your market determines that.
If less people qualify for purchasing a home, demand for rentals will increase.
Rental costs are directly proportional to costs of housing, including debt service.
This should lead to stable or higher rents, with a larger potential pool from which to draw tenants.
Major apartment builders foresee a booming rental market and are building like crazy in the Raleigh-Durham market.
I am hoping that interest rates go up so more people are forced to rent. We have a glut of rental vacancies here in Dallas as there are a ton of new homes, previously owned homes and builder homes on the market that are easy to buy.
C-
Rising Mortgage rates usually give us a better rental demand. And, after finally getting a tenant for one of our townhouses after a 6 week vacancy, this is not a bad thing.
So at this point in the market. If one is considering buying a home should he wait till housing prices drop before he buys?
So at this point in the market. If one is considering buying a home should he wait till housing prices drop before he buys?
That is the general www.idea.the market has slowed down in the 2nd quarter this year according to NAR reports but that only means the inrease has slowed down..prices havent dropped...I dont see a decline happening unless youre in a really depressed market..the hot markets will just cool off but wont drop..
I live in Phoenix, Arizona.
Have had ,major problems with my credit in the past.
My score is still low but i did get qualified for a loan.
Only problem is my interest rates are really high.
Not sure what to do. I am currently working on repairing my credit and trying to get my score up. But my main concerned was waiting till my score got better and at the same time prices of homes going up. It seems prices of homes aint going up anytime soon right?
Any help for this poor desperate soul would be greatly appreciated.
Should i buy now?
Should i wait?
The following is from the public NAR website (www.realtor.org) 11/22/05....
David Lereah, NAR’s chief economist, said the pace of price appreciation in the third quarter is far from being normal over time. “These historically high home price gains are the simple result of more buyers than sellers in the market,” he said. “The good news is that inventory levels are improving, and housing supply will come close to buyer demand in 2006. In other words, we expect a healthy and more balanced market next year.”
End of quote.
Thought it might be of interest.
Jim
[ Edited by jimandlacy on Date 11/22/2005 ]
Quote:I live in Phoenix, Arizona.
Have had ,major problems with my credit in the past. My score is still low but i did get qualified for a loan. Only problem is my interest rates are really high.
Should i buy now?
Should i wait?pcazar,
The problem is your credit score. You are correct that repairing your credit should be your first priority. Repairing your score is not an overnight process, it takes time, up to two years.
Consider that the cost of renting in your market may be cheaper than the cost of homeownership, especially with a very high interest rate. Repair your credit first; get your FICO score above 720 so you qualify for the lowest prevailing loan rates.
Over the next year or two, I expect your market to stabilize. Prices may even stagnate while more motivated sellers will lower their asking prices. In two years, when you have repaired your credit, you still should be able to buy a property comparable to what you are looking at today at prices you are seeing today.
Repairing your credit should take precedence over taking on more expensive debt and further weakening your financial statement.
Just how I see it.