Interest rates in the U.S. are on the rise. In fact, the central bank recently announced its biggest increase in interest rates in over 20 years. This is in response to the rapid inflation that's currently wreaking havoc on the U.S. economy.
When the economy suffers, it has far-reaching effects on almost every aspect of our lives. Of course, the housing market isn't excluded from this. So, what kind of effect will rising interest rates have on the Staten Island real estate market?
That's what we're going to be discussing today. Read on for a rundown of everything you should know about the situation.
Recent Real Estate Trends in Staten Island
Before we can find out where the market is headed, we need to take a look back at the recent history of prices of Staten Island homes. How has the market been behaving of late?
Historically speaking, Staten Island was considered "the forgotten borough." Its location automatically made it an outlier. But in recent years, its popularity has been picking up.
Like many markets across the country, there are more eager buyers than there are homes to sell. This scarcity of inventory has caused house prices to rise.
Last summer, the median monthly sales price for homes in Staten Island hit an all-time high of $610,000. Since then, little has been done to address the housing shortage, which has pushed prices up even further.
At the moment, homes are selling fast. They're also selling for a lot more than they would have five years ago.
How Rising Interest Rates Will Impact the Market
So, as this situation stands at the moment, there's a shortage of inventory, prices are up, and now there are rising interest rates to worry about. What do these factors mean for the market?
The thing you need to know about higher interest rates is that they'll usually lead to higher mortgage loan costs. This, of course, makes buying a home more expensive for those using a mortgage to do so. This could potentially pump the breaks on the rapidly rising house prices in Staten Island.
Typically, rising interest rates make it more difficult to buy a home and sell a home. So it could be that the currently hot Staten Island real estate market is about to cool off a little bit.
If you're not using a mortgage to purchase a home, this could be the perfect time to pounce. In general, it's a good idea to keep an eye on how things will change over the coming months.
The Outlook for the Staten Island Real Estate Market
While it's certain that rising interest rates are going to have an effect on the Staten Island real estate market, it will likely remain difficult to purchase a home as it currently is. Your best option is to work with local realtors who are familiar with the ins and outs of Staten Island real estate. If you're looking for a top-notch local realtor,get in touch with our team today.
Wonica Realtors & Appraisers are Staten Island's #1 independent full-service real estate firm, serving the needs of the community for over 30 years. Whether you are buying, selling, renting, or relocating, our staff of highly trained professionals will provide quality realty services with personal attention to your individual real estate needs.