Are markets shifting in Seattle?

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This weekend while driving around my neighborhood in Seattle, I noticed more “for sale” and “open house” signs on homes. It’s a welcome sight after how long we’ve been in this tight market with very little housing inventory.

It’s typical to see more homes come on to the market this time of year. I’m wondering how much mortgage rates moving away from historic lows and towards are more “normal” range may be impacting home owners deciding to sell now while rates are still relatively low.

Let’s take a peek at how much raising interest rates can impact mortgage payments based on a sales price of $770,000 with a 20 percent down payment, a “high balance” conforming 30 year fixed rate with a loan amount of $616,000.

EDITORS NOTE: Rates quoted are EXPIRED!  As of 2:30 pm May 8, 2018, I’m quoting an interest rate of 4.750% priced with 0.683 points ($4,207.28) with an APR of 4.863%.  Principal and interest payment of $3,213.35 does not include property taxes or home owners insurance. Click here for a detailed mortgage rate quote for your personal scenario.  NOTE: Mortgage rates quoted are subject to (WILL) change and subject to credit approval.

At this price point, 0.125% in interest rate equates to roughly just under $50 a month in mortgage payment. $50 a month can add up quickly… especially if the increase becomes 0.25% in rate or more. Since the beginning of this year, mortgage interest rates for the 30 year fixed conforming have gone up just over a half percent in rate, per Freddie Mac’s PMMS report. A jump of a half point in rate would be about $190 more in monthly mortgage payment. You get the picture.

Higher interest rates will make homes in the greater Seattle area even less affordable… perhaps Seattle area home sellers are attune to how mortgage interest rates returning to a more normal range from the ultra-low Fed manipulated rates may impact their potential home buyers. Or maybe those who are taking the plunge to sell their Seattle area home now are wanting to grab a lower rate on their next home before the move much higher. We have friends and neighbors who have decided to sell now, thinking the market may be near the top and are wanting to “cash in” on Seattle’s hot market so they can buy their (eventual) retirement home and still have a lower than average mortgage interest rate.

By the way, if you are considering selling a home and would like to buy your next home before your existing home closes, we have recently revamped our bridge loan. Both homes need to be located in Washington state. And of course, if you are thinking about buying or refinancing a home located anywhere in Washington state, where I’m licensed, I am happy to help you. Click here for a no hassle mortgage rate quote.

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