ON THE BUBBLE: THE SUMMER 2022 MARKET

The real estate market has been on quite a ride! If you had your home on the market in late 2019 through early spring 2022, and you sold your property, you reaped the market advantage. Right now, the real estate market is riding on the bubble as the Fed slowly began increasing interest rates in early 2022.

The Federal System Reserve, better known as “the Fed”, is the central bank of the United States. According to the Federal System Reserves website, the Fed serves several functions:

1. They conduct the nation’s monetary policy by influencing money and credit conditions in the economy in pursuit of full employment and stable prices.
2. Supervising and regulating banks and other important financial institutions to ensure the safety and soundness of the nation’s banking, and financial system and to protect the credit rights of consumers.
3. Maintaining the stability of the financial system and containing systemic risk that may arise in financial markets.
4. Providing certain financial services to the U.S. government, U.S. financial institutions, and foreign official institutions plays a major role in operating and overseeing the nation’s payments systems.

IN OTHER WORDS…

All that to say the Fed controls much of our American financial lives and how we live through interest rates and spending. When the interest rate is low, we have more buying power. If interest rates are high, we have less buying power.

As a seller, your home on the market in 2019 through early 2022 caught the awesome real estate market wave- you were able to ask more for your house due to the pandemic, high market demand, and low-interest rates.

If you were a buyer, though you paid a higher price for a property, the interest rates provided you with more buying power. In a sense this market was a win-win for everyone.

THE BUBBLE

Since early 2022, the Feb has slowly raised interest rates. With this change, a .75% increase, folks looking to buy or build will now pay more for a home- your buying power has shrunk, and you get less of a home for a higher price. To add to it, the bad news of inflation which means the products used to build homes have inflated as well.

The upside in all this inflation and rate increase? United Country Midwest Life Style Properties Real Estate Agents have your back. Owning property has great advantages. Our aim? Helping you get the best real estate advantages.

MARKET AVAILABILITY

In the coming market, we will have homes available but fewer buyers. This means you, the buyer, have the upper hand in negotiating the price of a home. And that’s an awesome upside. Here are a few more tips on how to gain a seller’s advantage:

1. BE READY to make an offer! Have Pre-Approval from your bank. Your real estate agent will take you seriously, and so will the seller.
2. United Country Midwest Lifestyle Properties Real Estate Agents come with a hefty pedigree. Don’t settle for anything less! Our dedication and experience are second to none. We don’t talk the talk without walking the walk.
3. Make an all-cash offer! If you have the financial ability, this is an excellent tool. Having cash on hand will make the process of buying the home faster. It’s instant cash to the seller and a fast possession for the buyer.
4. Up the ante. Put down more earnest money. This will get the seller’s attention as well. The extra earnest money tells them you are serious!
5. Escalation Clause. Have your real estate agent write in an Escalation Clause to your purchase offer- this allows you the chance to raise your bid if anyone else would outbid you. These generally have a predetermined amount.
6. Contingencies and Concessions. Be flexible where you can. Insist on a home inspection, but relax the demand to have the bathroom remodeled or a patio fixed? Maybe drop the appraisal contingency or the inspection? Go easy on the timeline? Your knowledgeable United Country Midwest Lifestyle Properties Real Estate Agent will guide you through making these decisions.

REAL. ESTATE. KNOWHOW

Even though interest rates are up, and the real estate market is on the bubble, being a buyer in this market has many advantages. Make good use of your local 

United Country Midwest Lifestyle Properties Real Estate Agent. They put their client first! Knowledge, expertise, and reputation- we stand on it!