I’ve been fielding a lot of questions from people recently. The thing people want to know about most is what effect the new president will have on interest rates.
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I’ve been getting a lot of questions lately about what’s going to happen to real estate values now that we have a new president. The short answer is there is going to be little impact, but here’s why.
There are roughly 32,000 jobs tied to the political arena. Additionally, 24,000 of them are located on Capitol Hill. Of those 24,000, 9,000 are considered nonpartisan jobs. They are there year round, no matter who is in place as leader. The remaining jobs are staffers who are not in a position to buy something. In the end, you have about 2,250 people who are qualified buyers that will be looking in the area.
Even though people are leaving with the old administration, there are people coming in with the new one. In this type of turnover in the past, we haven’t seen an exceedingly high supply. There is a net gain and a net loss. The policies put forth by the new president are what will have a large and lasting impact
We are going to see more increases in interest rates.
Based on indicators in the marketplace, we are going to see an interest rate increase this month and maybe another one soon after. You need to be prepared for those higher rates if you’re thinking about buying. A rise in rates will affect your buying power and the type of home you can afford.
Keep in mind that right now, interest rates are historically low; under 4%. Don’t be concerned about them going up, as this is a normal part of what looks like an improving economy. It’s just something to be aware of moving forward.
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