Rising mortgage rates will cause only a small percentage of potential buyers to fully give up a search for a house, according to a new survey.
Redfin polled 934 people who said they planned to buy a home within the next year, asking them what their plans would be if mortgage rates rose above the current 4 percent. Only 2.6 percent of respondents would cancel plans to buy a home. Another 25.8 percent said that they would slow down a search to see if rates fall. A quarter of respondents said that rising rates won’t affect their search at all.
Why are homebuyers so resilient? While there’s no definitive answer, often homebuyers are searching for a new home because of a major life event, such as a birth or a marriage or a job relocation, which can’t easily be timed to the market — but which still motivates a purchase along its own timeline. And while rates have climbed, they’re still historically low, which many homebuyers realize.