The Forecast For Housing in 2014: Higher Prices, Rates
It’s anyone’s guess where rates or housing prices are going to go over the next year. You don’t need to be Nostradamus, you need to be like Macgyver. The key is to try to be as prepared as you can for whatever the market throws at you. Mortgage rate increases will definitely reduce the amount of house you can buy—about a 9% reduction in purchase potential for every 1% mortgage rate increase. You should also consider non-traditional sources of financing, like seller financing, financing from private individuals and ‘hard money’ lenders for short term real estate rehab projects. It’s not one size fits all—the type of financing you’ll need or can qualify for will depend on the amount of time you’ll need the money and your exit strategy.