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How raising interest rates could impact the real estate market in Brevard FL

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How raising interest rates could impact the real estate market in Brevard FL

How raising interest rates could impact the real estate market in Brevard FL

These days, there isn’t a lot of positive news regarding interest rates. The cost of borrowing money has increased significantly as the Federal Reserve has fought to curb inflation. This has resulted in increased interest rates across the board, including rates on mortgage loans for homebuyers in Brevard, Florida.

According to Freddie Mac, the rate on a 30-year fixed-rate mortgage increased to 5.78% on June 16 from 5.23% the previous week. Since 1987, it was the biggest one-week spike.

But how will raising interest rates impact the real estate market in Brevard County?

Higher interest rates equate to higher larger monthly mortgage payments, reducing consumers’ purchasing power when looking to buy a property. What’s that look like? A homebuyer’s purchasing power decreases by around 5% for every half-percent increase in loan rates.

The real estate market in Brevard (and throughout Florida) has been RED HOT. However, what we expect to see as interest rates continue to increase is a moderate slowdown in sales, likely leading to a stabilization or even moderate reduction in home prices.

During this transition we may see the market dynamics shift from a seller’s market to one that is more balanced with equal power between buyers and sellers alike.

That said, we are still in a seller’s market in Brevard, and there is likely no better time than now to list a home for sale, ahead of any future planned rate hikes.