Phoenix is a trendy place to move to, which is why new communities are popping up across the area. The master plan community known asis just one of many new spots to call home. The valley of the sun is an attractive place to live with the amazing weather and endless things to do. From top attractions to gorgeous hiking spots, Phoenix is a rising city. However, interest rates also continue to rise. Will the rise in interest rates impact these new homes?
Even though theis a bright star in the desert offering premium amenities, some fear that great communities like this one and others around the city will see loss of purchases due to high interest rates. With super cheap mortgages a thing of the past, the spike in interest rates could impact these . Currently, the interest rate is at 1.9 percent and is only expected to increase. For years, we have been seeing close to zero percent interest rates, so the rise is sending a shock wave to new home buyers.
Real Estate Impact
The impact on real estate doesn’t happen right away, but with the interest rates expecting to rise even more, we are expected to start seeing some lower numbers in home purchases. Other factors of the housing market play a role as well such as the recent tax bill, along with local and state property taxes. Coastal regions are expected to see more of a spike than the rest of the country. Sales have already seen a decline since owning a new home has become more expensive compared to recent years.
The numbers aren’t alarming yet, but 2018 has had lower sales than in 2017. However, the market still continues to be stronger than previous years. As the rates increase though, the number of sales will likely decrease. There is hope that we may not see too harsh of a decline since Millennials are starting to buy homes.
What to Do?
Since we are unsure how the market will react to increasing interest rates, it is a good idea to start looking now and consider purchasing sooner rather than later. Luckily, Phoenix is currently full of beautiful and new housing communities like Sky Crossing.