Dear Cape Friends,
If you're new here, welcome. If you've been along for the ride, welcome back.
This past weekend, while showing a spectacular listing of mine in Truro overlooking Cape Cod Bay, I found myself in a conversation with a savvy businessman who was considerably more qualified to discuss monetary policy than me. Then again, I spend an unhealthy amount of time thinking about my deteriorating golf swing, striped bass, and real estate, so the bar isn't particularly high. (Of course, if the new Fed Chairman or the Secretary of the Treasury happen to be reading this and would like my opinion, I'm happy to squeeze them into my calendar. Just sayin'.)😀
Anyhow, the conversation started with real estate and somehow ended up touching on inflation, the Federal Reserve, and events unfolding halfway around the world.
The gentleman I was speaking with made a simple observation: "We are living in a different world than just a year ago, I don't think interest rates are coming down anytime soon." Whether he's right or wrong is anybody's guess.
What struck me, however, wasn't his prediction. It was the realization that I've been hearing some version of that same conversation for nearly three years.
The Waiting Game
Many prospective buyers have been waiting:
• Waiting for mortgage rates to come down.
• Waiting for more inventory.
• Waiting for prices to soften.
• Waiting for a clearer signal from the economy.
And while all of those things may eventually happen, the reality is that the market rarely sends engraved invitations. Note to self: This isnt The Masters.
The challenge, of course, is that life doesn't always wait - Children grow up. Grandchildren arrive. Retirement begins. Families decide they want summers on the Cape. Boats need docks. Dogs need beaches. And suddenly the question becomes less about where rates will be six months from now and more about where YOU want to be.
Don't get me wrong. Interest rates matter. A lot.
A difference of even one percent can significantly impact a monthly payment. But when buyers ask me where rates are headed, my answer is usually the same:
I have no friggin idea. And anyone who tells you otherwise is probably guessing. And please, do not take what CNBC says to the bank. 🙏 They may sound confident and informed, but yup, they too are trying to read the tea leaves like everyone else.
Afterwards, I called my friend Tricia Besse over at The Cape & Coast Bank and asked her the same question. Her response was refreshingly straightforward. “Nobody knows exactly where rates are headed.”
While forecasts vary, Tricia's advice remains consistent: focus first on finding the right property and understanding what you can comfortably afford today, rather than trying to perfectly time the market.
If you'd like to connect with Tricia, click here. She has been helping Cape Cod buyers navigate the mortgage process for many years and is an excellent resource. Shes also a single digit handicap over at Hyannisport Golf. Respect.⛳
The Federal Reserve doesn't directly control mortgage rates. Inflation, economic growth, government borrowing, investor sentiment, and increasingly world events all play a role. The result is a complicated system that has a habit of humbling even the smartest economists. Which is comforting, because it means I'm not the only one who's occasionally wrong.
What Really Matters
What I do know is this: I've met very few people who regret buying the right property. I have met plenty who regret waiting too long for it.
Could rates be lower a year from now? Absolutely. Could they be exactly where they are today? Also possible. Could they be higher? Nobody knows.
In the meantime, like my grandmother would say “life marches on.” As the weather warms, the stripers return. The traffic gets a little heavier, and so does the line at the Squire. Families continue looking for a place where they can spend summers together, welcome grandkids, launch a boat, walk the dog, or simply slow down a bit..
For many buyers, that's ultimately what they're purchasing. The interest rate is simply part of the equation. The memories are the reason for making the investment in the first place.
Footnote: For those interested in the broader economic backdrop, I recently came across an interesting HousingWire article discussing mortgage rates, inflation, Federal Reserve policy, and the potential impact of global events on the housing market. Worth a read if you're inclined toward such things.
(If you're around Friday morning, I'll be holding court at Chatham Perk from 8:00–9:00 AM. As always, the coffee is on me. Feel free to stop by and say hello.)
See you around the elbow (and hopefully Friday morning),
Paul
P.S. If you're thinking about buying, selling, or simply keeping tabs on the market here on the elbow- or if you know someone who is - PaulBorde.com is a great place to start. You'll find listings, market updates, past newsletters, and enough reading material to get you through at least one rainy Cape Cod weekend. A few of the articles came dangerously close to Pulitzer Prize consideration. 😀