Most likely home buyers are aware that mortgage rates are expected to increase, and because of those rising rates, nearly half of home shoppers said they would delay purchasing a home, consider buying a smaller home, or both, according to a recent Zillow survey.
Among home buyers who said an rising mortgage rates would make them reconsider their home buying strategy (47%), 17% said they would search for a smaller home in a more affordable neighborhood, 12% said they would consider delaying their purchase, and 19% said they would consider both strategies.
though, rising interest rates are not among the top concerns of home buyers. Price and availability of homes within a
given budget are the leading concerns among respondents currently in the market
or who expect to be in the next year. More than a quarter (29%) of respondents
cited “finding an affordable home” (which we broadly interpret as concerns
about inventory and price) as the top factor that may impact their ability to
buy a home within their preferred timeline. The next most commonly cited
concerns were saving for a down payment (19%) and qualifying for a
loan/concerns over credit scores (18%). Rising interest rates ranked fourth
among the six options given (14%).