Interest rates have a significant impact on the real estate market. When interest rates are low, mortgage payments are more affordable, and this encourages people to buy homes. This increased demand can lead to higher home prices and a seller's market.
Conversely, when interest rates rise, mortgage payments become more expensive, and this can lead to decreased demand and lower home prices, creating a buyer's market. Additionally, higher interest rates can also impact the availability of credit, which can make it harder for some people to obtain a mortgage and enter the real estate market. Overall, understanding how interest rates impact the real estate market is crucial for both buyers and sellers to make informed decisions.