It has been a very interesting year, regardless of where you fall on the political spectrum. One thing for certain, we are in for a interesting 4 years.
The big question is what does that mean for the real estate market? Are prices going up, down, sideways? The truth is much depends on what happens with the Fed.
Buyers are very sensitive to payments. We have been in a historically low interest rate period, that I at 55 years old, have never seen before. Possibly I will never see again.
I remember when my wife and I bought our first home. We had a credit score just under 800. We made 6-figures and our interest rate was 7.25%. We thought we were stealing the money it was such a good deal. Interest rates are half that now. What do you think would happen if rates jumped to 7.25%? It would collapse the market. You would hear the scream for miles.
Now I don't think rates are heading up that drastically. The economy is still iffy and is sensitive to rate increases. However, as rates increase, that will have the effect of flattening prices. Since people are buying based on what they can afford monthly, if that amount goes up due to higher interest, the amount they spend must necessarily go down. Just something to keep in mind as rates increase.