We use cookies to enhance your browsing experience and deliver our services. By continuing to visit this site, you agree to our use of cookies.More info
ALL IN Miami GroupALL IN Miami Group
Call Us:

(305) 439-3031

    Miami's ULTIMATE Dining Guide
    Follow us
    The Team

    About Us

    • Meet the Team
    • Contact Us
    • Our Award Winning Blog
    • Miami's Best Neighborhood Guide
    • Miami's Best Restaurants

    Our Services

    • Why Sellers Hire Us
    • Get Your Home's Value
    • Why Buyers Hire Us
    • Search for Homes
    ALL IN Miami Group

    2550 S Bayshore Dr, Suite 106, Miami, FL 33133

    • (305) 439-3031
    • [email protected]

    3 Ways Low Mortgage Rates Impact The Value of Your Home

    The COVID-19 pandemic has had an effect on everything... From travel to toilet paper stock at your local grocery store....

    • Amit Bhuta
    • April 7th, 2020
    • 3 min read
    Featured Image

    The COVID-19 pandemic has had an effect on everything...

    From travel to toilet paper stock at your local grocery store. However, there’s another effect you might want to keep an eye on if you’re a homeowner: Falling mortgage rates. In the United States, the Federal Reserve cut rates by half a percentage point on March 3 (to keep up with the market), then again by 1.5 percent on March 15 (in response to COVID-19). In Canada, the Bank of Canada cut rates by 1% on March 13.

    What does this mean if you’re already a homeowner? The first answer is easy: If you’ve been thinking about refinancing, now’s a good time to lock in a low rate. But if you’re concerned about the value of your home (particularly if you’ve been looking to sell in the next year), the news is a little more complicated. Here’s how the latest low mortgage rates might impact home values:

    ONE

    The number brings out more buyers — typically.

    Low mortgage rates motivate many potential homebuyers to take the leap into homeownership. When there are more buyers than there are homes, supply and demand apply and you can expect property values to increase. However, that’s the expected scenario when there are low rates without a worldwide pandemic. If COVID-19 keeps buyers at home and properties linger on the market, price cuts abound and then create a trend towards lower home values.

    TWO

    Low rates here means low rates elsewhere.

    Interest rate changes don’t just affect mortgages, it also affects savings accounts, CDs and other investments. Lower rates of return elsewhere mean less capital that could go into purchasing real estate, a factor that puts “supply” ahead of “demand.” Ideally, though, lackluster rates of return could motivate potential buyers to put their money into real estate instead, leading to a rise in home prices (and home values).

    THREE

    Buyers could be waiting for even more cuts.

    While no one knows the long-term effects COVID-19 will have on the economy, many anticipate another rate drop to follow. Potential buyers might take a “wait and see” approach, which leads to homes languishing on the market, price cuts and possible trends in lower home values as a result if it’s a long-term issue.

    Overall, the low mortgage rates generally mean good news for sellers, but the current pandemic does add an element of uncertainty that brings caveats. While national trends are an important factor to watch, your best indicator of where your local market is going is by keeping an eye on your neighborhood — and getting in contact with a realtor who already is up on the area.

    While we tried to cover the most common reasons why low mortgage rates can affect property value...

    The other factors that could affect your home’s value might not have been mentioned. We know that every seller has different timelines and priorities. 

    If you’re concerned about how your home’s value could be affected by low mortgage rates, we’re here to listen to your concerns and help walk you through the process.

    Let's Talk

    Author Photo
    About the author

    Amit Bhuta

    (305) 439-3031
    • facebook
    • X
    • instagram
    • linkedin
    • youtube
    I use non-traditional marketing to inspire the most motivated buyers to pay the max for Miami luxury homes. Besides selling real estate, I love tennis, sports cards, NFTs, my family, mental health awareness, and HIGH-calorie foods 🤷🏽‍♂️

    Similar posts like this

    Neighborhood Blogs

    Top 5 Coffee Shops Near Biscayne Park

    Slide into your day with slow sips, fresh pastries, and a sense of stillness as you visit the top cafés just outside Bis...
    Read more
    Neighborhood Blogs

    Top 5 Hotels Near Biscayne Park

    Swap your never-ending to-do list for robe service, room keys, and blissful silence as you unwind at the peaceful retrea...
    Read more
    Neighborhood Blogs

    Top 5 Instagrammable Places Near Biscayne Park

    Wander into scenes that feel like pages from a vintage photo book as you roam the most charming corners near Biscayne Pa...
    Read more
    ALL IN Miami Group

    PRICELESS Marketing Your Home Deserves!

    ALL IN Miami Group | Compass | 305.439.3031

    2550 S Bayshore Dr, Suite 106, Miami, FL 33133

    ALL IN Miami Group | Compass | 305.439.3031

    2550 S Bayshore Dr, Suite 106, Miami, FL 33133

    (305) 439-3031
    [email protected]

    Footer Links

    • Meet the Team
    • Read Our Blog
    • Client Reviews
    • Why Sellers Hire Us
    • Get Your Home's Value
    • Why Buyers Hire Us
    • Search For Homes
    • Miami's ULTIMATE Neighborhood Guide
    • Contact Us
    GET OUR LATEST ADVICE

    Join 9,383+ People Getting Our Emails

    *We respect your inbox. We only send interesting and relevant emails.

    ALL IN Miami Group | Compass | 305.439.3031 © 2025

    Privacy Policy
    Powered by