Had an amazing thing happen a few days ago: One of my agents was representing a buyer in a deal. When the buyer saw how much interest rates had moved in the last week or so, he changed his mind about the deal. In an effort to try to keep the deal together, my agent asked what it would take for the buyer to stay in. Buyer requested a $30k price reduction, prior to inspections.
Here’s where things got weird: When my agent called the listing agent to explain the situation, the listing agent explained that he had had two other deals blow up over the interest rate change and that he’d talk to the seller and see what he could do.
Pause for a moment to consider how crazy that is: What kind of seller agrees to a price decrease BEFORE the inspection, knowing full-well that the buyer may come back with a request for another reduction after getting back the inspection report?
The answer is: A realistic seller who actually wants to make a deal. When rates go from 4% to 4.5%, the numbers on the deal change for the buyer. If you’re a seller who wants to make a deal, you need to be willing to be somewhat flexible.
Rates can’t stay this low forever. We’re in for increasing interest rates for the foreseeable future. And everyone in our world needs to consider what that means for their deals.