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Realtors share how increased interest rates affect home buyers in the Brazos Valley

Posted at 11:23 PM, Jun 20, 2022
and last updated 2022-06-21 00:23:08-04

BRYAN, Texas — In an attempt to fight inflation, the Federal Reserve’s interest rates on loans has increased by 0.75 percent this month - the largest bump seen since 1994.

Brazos Valley realtors are taking notice of the local impact.

With the rise in interest rates, plenty of Americans without fixed interest rates on their mortgages may be paying more each month for their homes. When it comes to selling homes, College Station-based realtor Wendy Flynn’s selling client just lost their buyer on Sunday– all due to interest rates.

“The recent increase in interest rate was a pretty significant jump," Flynn said. And this was an entry level home. With this particular buyer, once the rates went up, he no longer was qualified for his mortgage loan.”

Realtor Roman Moore III, based out of Brenham, sells all over the Brazos Valley. He noted that while he’s seen the interest rates go up in the past, it’s more the abrupt nature of the rise that concerns him. Moore said that as interest rates rise over 5 percent, it will be more expensive for people to borrow money.

“It’s going to require a higher down payment and higher credit score, and all this has an effect on a first-time home buyer, or on persons only able to purchase homes around $300,000 or so," he said.

Moore said he's noticed that there’s still plenty of interest in buying and selling homes in the Brazos Valley, especially from city dwellers moving out to the country. Buyer behavior has fluctuated significantly this year, from what he's observed.

“At first, at the beginning of the year, the buyers wanted to wait," Moore said. "As the housing market gets more and more publicity, they want to hurry up and buy. Now that the interest rate over five percent, they want to sit back and wait again.”

While these realtors do feel some concern seeing the current interest rate, especially for first-time homeowners with no equity, Flynn said that the realty market in Brazos Valley area has some benefits, because local inventory is good.

“Right now there still are a lot of buyers that want to buy and need to buy, and we have a lot of homes to sell, so things are looking good for the remainder of the summer at least," she said.