FAYETTEVILLE, Ark. (KNWA/KFTA) — Another hike in interest rates might have those looking to buy a home, in a market that’s already competitive, pretty nervous.
A realtor says as soon as a house is built or goes on the market, tons of people are going to look at it. So she said there’s a lot of buyer fatigue as people lose out on the homes they want by getting outbid or the rising interest rates are making some homes too expensive for them.
Roy Phillips Jr. is like many trying to buy a home in a chaotic housing market, and now has to navigate the Federal Reserve raising the interest rate 0.75 percent Wednesday, meaning the type of home he’ll be approved for is changing.
“I waited and now with the rates going up, it’s almost like ‘Oh, I should’ve did it when I had the chance'”, said Phillips.
Victoria Fields is the realtor helping Phillips find a new home.
“Your buying power could go from $450,000 down to maybe $400,000. You just never know and so that just changed what types of homes you can buy,” said Fields.
She focuses on helping young buyers in a seller’s market, meaning more people are looking for homes than what’s available in Northwest Arkansas.
“It’s just something that I want for myself to be able to deal with that equity and pass it down to the family that I hope to have one day,” said Phillips.
Phillips is currently renting, which with the price of monthly rent increasing around the area as well, feels pointless when Phillips says he could be paying the same on a mortgage.
“You’re throwing money in the air and you’ll never get it back versus owning a home you’re able to build that equity,” said Phillips.
Feilds said many of her clients say they’re scared to pay too much for a house, but a local lender, Chandler Hesington, said the increased interest rates shouldn’t scare people away, especially in a community growing as much as NWA.
“Ask your parents what the interest rate was when they bought their first home and just look at what that home is worth now in today’s age,” said Hesington.
Interest rates are expected to keep going up little by little to fight inflation. Fields’ advice right now is if you’re in the position to buy a house, it’d be smart to do so.
She said you can always refinance if the interest rates go back down. Phillips is optimistic about finding the right home, but until he does he said he’s going to continue to save his money to keep up with the rising interest rates.