Mortgage rates are back above 7%.
And almost immediately, I'm hearing the question again:
“Should we just wait?”
I understand the instinct.
When rates rise, affordability changes. Monthly payments increase. And for buyers who have already been stretching to compete in an expensive market, another increase can feel like a reason to step away.
But here's the part of the conversation I think we're missing:
When enough buyers decide to wait, an opportunity can open for the buyers who don't.
We're beginning to see exactly that.
Nationally, pending home sales are down, inventory is growing, and more sellers are reducing their asking prices. After years of buyers competing in crowded open houses, waiving contingencies and making aggressive offers simply to secure a property, the balance is shifting—at least for the moment.
And that creates a pocket of opportunity.
It doesn't mean homes suddenly became inexpensive. They haven't.
It doesn't mean every seller is ready to negotiate. They're not.
And it certainly doesn't mean a higher interest rate doesn't matter. It does.
But fewer buyers in the market can change the entire negotiating dynamic.
A property that might have generated six offers in a different rate environment may generate two.
A seller who wouldn't entertain a concession may suddenly be willing to have the conversation.
A buyer may have more time to evaluate a property, conduct due diligence and negotiate terms without feeling like someone else is standing behind them ready to take the house.
That's worth paying attention to.
THE RATE CAN CHANGE. THE PURCHASE PRICE DOESN'T.
There's another important distinction buyers sometimes overlook.
The price you agree to pay for a home is permanent.
Your mortgage rate may not be.
If rates decline in the future and the numbers make sense, refinancing may be an option. There are costs and qualifications involved, so I would never advise someone to purchase a home based on the assumption that they'll definitely be able to refinance.
But here's the other side of that equation:
What happens if rates come down and all of those buyers sitting on the sidelines come back at the same time?
More buyers don't necessarily mean better opportunities.
They can mean more competition.
More bidding wars.
Less negotiating leverage.
And potentially higher prices for the homes everyone wants.
That's why trying to perfectly time the housing market can be so difficult.
DON'T ASK ONLY ABOUT THE RATE.
Instead of asking:
“Is 7% too high to buy?”
I'd ask a different set of questions.
Can I comfortably afford the payment today?
Is this the right property for me?
Am I buying it at a price that makes sense?
Do I have negotiating leverage that I might not have had six months ago—or might not have six months from now?
And does buying today make sense for my life and my long-term plans?
If those answers line up, the fact that other buyers are sitting on the sidelines shouldn't automatically put you there with them.
After more than 25 years in real estate, I've seen opportunities appear in markets that didn't look particularly attractive on the surface.
Sometimes they're created by falling prices.
Sometimes they're created by increased inventory.
And sometimes they're created simply because everyone else decided to wait.
We may be in one of those moments now.
If you've been thinking about buying in Hoboken, Jersey City or Northern New Jersey, don't assume higher rates mean you should stop looking.
Let's look at the numbers, the inventory and the opportunities that exist right now.
Because sometimes the best time to pay attention is when everyone else is looking away.
— Farah Alli