Buyers Say Rising Rates are Painful

Buyers blame rising mortgage rates for making it more difficult to purchase a home and altering the pace of their home search, according to a new Redfin survey of more than 1,700 home buyers across 22 markets.

Sixty-three percent of buyers surveyed say mortgage rates are hampering their ability to afford a home, and the majority also said that rates have caused them to re-evaluate their home search. Thirty-three percent of respondents said they are speeding up their search before rates rise higher, while 20 percent say they are slowing down their search. One percent said rising rates have halted their search altogether.

“Our survey results underscore buyer sensitivity to this summer’s mortgage rate fluctuations,” said Redfin economist Ellen Haberle. “Should interest rates spike again in the coming months in response to a tapering by the Federal Reserve of asset purchases, we could see a significant drawback or even a temporary freeze in buyer activity.”

Among buyers’ top concerns about purchasing a home right now, low inventory remains No. 1, with 58 percent saying that is a hardship in their home search. Mortgage rates came in a close second, with 53 percent saying that is a concern.

Source: Redfin