In an article for Investopedia, Atlas Partner and Co-Founder Ryan Boykin discusses the effects of rising interest rates in buying and selling real estate.
“Rising interest rates do have a very noticeable effect on buyers and sellers. Hypothetical situations prove that property value and housing prices directly correlate to mortgage rates, but what underlies both scenarios is the health of the economy.
If the economy grows fast enough, rising mortgage rates will not have as great an effect on property value and housing prices. For example, if mortgage rates increase one point, monthly payments increase $238. However, a strong economy allows employers to increase salaries enough to help compensate for the rising interest rate. As long as the economy continues to grow, and we continue to see job growth and wage growth, a rise in interest rates should not paralyze the housing market.”