How have the recent Fed rate cut and stock market drop affected the real estate market and interest rates? Due to coronavirus and other factors around the world, the stock market has taken a fairly significant dive in the last month or so. For these reasons, interest rates have dropped a lot. They were already at historic lows in December and January, but now they’ve dropped further.
For example, for a 30-year conventional fixed loan, you can get a rate in the low threes. This is astonishing and historic. We’re seeing many people take advantage of the refinancing opportunities to reduce their rate. If you have an interest rate with a four in front of it, you should consider refinancing your home.
If you’re considering buying a house and were thinking of waiting until the spring or summer, it’s a great idea to get your pre-approval now and take advantage of the low interest rates. When interest rates are down, your buying power increases. If you’re looking to sell a home, these low interest rates benefit you by driving more buyers into the market. That being said, inventory is still quite tight due to high demand.
Whether you’re going to refinance or purchase, make sure you know who your lender is and that they can serve you in time. Here’s what I mean: A lot of large banks, like Wells Fargo, for example, are telling people it will take four months to close a loan and about a month to get an approval because they’re so behind due to the uptick in the market. So make sure whoever you choose can perform on time—ask that question up front.
Reminder if you’re a home seller: Check out our free home value report. Reminder if you’re a homebuyer: We have a free MLS search tool for properties all over Southern California. If you have any lending or real estate questions, give me a call or send an email today. I would love to help you.
