Why Do Mortgage Interest Rates Really Matter?

Answer:

For every1% decrease/increase in the interest rate, the monthly principal and interest (P&I) will be changed by 10%.

Let's say you have a friend who bought a $500k home last year when rates were 7.26%. Their estimated monthly P&I bill would be $3,414.

You decide to buy before the end of the year and receive a 6.26% rate on a $500k home. Your monthly P&I payment will be about $3,082.

That is a savings of $333 every single month!

(Psssst! If you have a rate of 7.2% or higher, consider reaching out to a lender to see how much you can save every month after refinancing. I have some names, if that helps. Reply and I got you.

Sleeping Market Beauty is Starting to Wake Up....

The higher the Seller's Market, the faster homes appreciate in value. Balanced is pretty flat. The lower the Buyer's Market score, the faster homes go down in value.

We now have 6 cities in Seller's markets, 4 in balanced, and 7 in Buyer's markets.

(Pssst again! Luxury markets are doing the best and the areas where there are a lot of new builds competing with resale homes are doing the worst.)

Quick note on a few cities. Any number above 100 is a Seller's Market, 90-100 is balanced, and under is a Buyer's Market:

-Chandler is at 130, a lot more demand than supply.

-Gilbert is at 114, a bit more demand than supply.

-Mesa is 106.

-Tempe is at 85. ooof!

Prices YOY and More.....

Most price points across the Valley have gone down from 2024 to 2025, though the results depend on the price point of the property we're talking about. (Wow to those over $3M who lost 13%!! You'll need a bandage for that ouchy!)

For the monthly period ending September 15, we are currently recording a sales $/SF of $284.42 averaged for all areas and types across the ARMLS database. This is down just 3 cents, or 0.01% from the $284.45.(Basically a total snooze-fest.)

On September 15, the pending listings for all areas and types show an average list $/SF of $316.41, up 0.08% from the reading for August 15. This suggests that closed prices are likely to be stable over the next 4 weeks. (Also, boring.)

We are through the summer slump and in most years, we normally see some upward price movement between September and December. The demand situation has improved but we are also seeing plenty of new supply coming through, so we don't expect a strong recovery in pricing.

thinking about buying your first home or has it been a long time since you last purchased a home? Don't go it alone! My free Home Buyer 101 course walks you through the entire process financing, inspections, negotiations & more. Get prepared and avoid costly mistakes.

Sign up here to check it out. (Which you should totally do right now. Really. Stop reading and click the link.)

Nancy Wittenberg