Rising interest rates have some benefits for homebuyers

Rising interest rates have slowed home sales in the Saint-Cloud area. This according to Craig Erlichman of Premier Real Estate Services in St. Cloud. He explains that the rise in interest rates from as low as 2% to almost 7% on a 30-year fixed mortgage has created what he calls a “correction” in the market. He says homes simply didn’t stay on the market long enough before with competition for most homes sometimes resulting in bidding wars.

Erlichman says the benefits of a slowing market due to rising interest rates are having some benefits for buyers, including building inventory levels, allowing inspections on homes, giving buyers the opportunity to negotiate and gives the buyer time to be selective.

Home values ​​are not falling, Erlichman says, despite rising interest rates. He says it’s possible we could see some values ​​diminish with negotiations likely to take place now. Erlichman says homes are still selling for 90-100% of their list price. He says the length of time a home is typically on the market is currently estimated at 28 days.

Renovations that can improve the value of a home include finishing your basement (if it isn’t finished), adding square footage to the home, remodeling kitchens and bathrooms, and adding a bit of curb appeal.

If you’d like to listen to my conversation with Craig, it’s available below.

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