Boston condo interest rates and Feds delicate dance
The mortgage interest chart below and the excerpt below is from Mortgage News Daily.
No surprise that mortgage rates will play a big role in how it plays out, and they have been extremely volatile lately.
The invisible impact on the market will be will be Boston condos buyers expect higher mortgage rates to convince sellers to lower their price. But sellers aren’t very empathetic, and most will go with their retail list price based on the highest comps ever recorded, and hope that cute young professional couple with two high-paying jobs falls in love and just pays what it takes to win it.
If rates miraculously drop back down to 5% and under, then Boston condo buyers won’t have a good reason to expect better pricing, and they will be tempted to give in and just pay what it takes. But if rates are 6% and higher, they have a rallying cry and the Big Standoff will be on.
They probably won’t have a number in mind, and the answer will just be ‘less’. It will likely end up being a binary decision – either rates are low enough that we’ll just go ahead and pay these prices, or they won’t.
The biggest challenge for buyers will be Boston condo for sale inventory, it will be most interesting to see if the Boston luxury homes – the real creampuffs – sit for long, or if they blow out to cash buyers or to those who care more about getting the right condominium, rather than the right mortgage rate.
The bottom line, If there is a steady stream of new Boston condos for sale inventory, it will help keep more Boston condo buyers to engage in the market. Hopefully, the delicate dance the Fed is orchestrating with interest rates will result in a soft-landing.