Real Estate FAQ’s, #3

Continuing on in my series of Real Estate FAQ’s, here’s the #3 most asked question: “When are we going to get to the bottom of the market?” Wish I had that crystal ball!  We have to go on facts and data and by that I mean historical data…what has been happening with real estate sales and what is the trend.  Where are we with unemployment?  Where are we with interest rates?  All magical questions that we really won’t know until it’s already happened, we watch trends as they’ve never lied.

Here’s a little info on , historical and estimated prediction of mortgage rates by economists.  The lower half in dark is the purchase volume of mortgage money spent; the upper portion in light is the re-finance dollar volume spent by year.

A common statement I’ve gotten from open-house lookers is “I’m waiting for the bottom of the market before I buy”…My next line is, “when you discover when that is, will you share with me?”  Same goes for interest rates; interest rates won’t be at these 50-yr  lows forever, and while they are so low, they TOTALLY impact a buyer’s purchasing power.  Every .25% of interest rate increase removes approximately $50K in purchasing power…So where do you think the bottom of the real estate market is and when will it be?   Watch for my monthly stats of Seattle Eastside to help you see the historical pattern.  I’m interested in your thoughts…

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