Does the thought of buying property in a high-interest-rate environment make you cringe? Here are a few reasons why people are still buying when interest rates are higher…
1) Life Milestones: Changes in your personal circumstances, such as getting married, having children, or changing jobs, can necessitate a move regardless of current interest rates. In these situations, the need for a suitable home takes precedence over the cost of borrowing.
2) Less Competition: Despite the larger monthly payments that come with high-interest rates, they also result in fewer people looking to buy. This reduction in competition can increase your chances of securing the property you desire, as there are fewer buyers in the market.
3) Negotiation Advantage: High rates often mean fewer buyers, which could make sellers more eager to negotiate on price or terms. As a buyer, this could work in your favour, making your desired property more affordable or the terms more appealing.
4) Hedging Against Inflation: Buying real estate can be a wise move to protect against inflation. When general prices increase, so does the value of properties. So, real estate can prove to be a smart long-term investment, even when interest rates are high.
5) Emphasis on Value Over Cost: For some, the value of owning a home and the lifestyle it provides outweigh the financial aspects. If you find the perfect home that fits your lifestyle and long-term goals, it may be worth buying even with high-interest rates.
6) Market Cycles: Experienced investors and homebuyers understand that markets go through cycles. Buying when interest rates are high (and potentially when property prices are lower due to fewer buyers) can position them for gains when the market changes and prices start to increase.
So, whether you’re navigating a significant life milestone, looking for the perfect home, or seeking an inflation hedge, remember: high-interest rates shouldn’t be the sole determinant of your home-buying decision.
If you’re ready to explore your options and turn this economic climate into an advantage, let’s chat!
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