Mortgage rates are climbing due to recent interest rate increases by the Federal Reserve. That means it costs more to borrow money, which drives down people’s buying power — especially in a competitive real estate market like Nashville.
It’s a dilemma that Sean Hamlet knows all too well. He lives in Brentwood with his wife and kids. They’re in Davidson County, but wanted to move to Williamson County for the public schools.
Hamlet says they were looking for a similar house, just a few hundred feet away from where they live now. But they found houses were about double the amount they paid in 2017.
To make matters worse, rates were historically low — about 3% — when they started looking. But in the last few months, rates rose to about 5% (which is still pretty low compared to the rates in the ’80s).
“I was like, uh, I need to do some recalculations,” Hamlet says, “because I think this is going to drastically impact our price point.”
And they had already increased their budget three times.
He did the calculations, and realized they would need to sell their current house before they would have enough buying power to purchase a new one.
That seemed like way too much of a risk. Selling their home would be no problem since there is a massive demand for houses.
But getting a new house would be a different story. They had already been outbid by $50,000, and houses were going for well above asking.
“We were like, ‘I don’t think this is worth it anymore,'” Hamlet says. “So we’re going to stay.”
They gave up on the dream of buying a new house. Hamlet says he knows a lot of folks who are in the same position.
“There’s several people we have in our neighborhood that have considered the same option,” Hamlet says. “We’ve all sort of shifted gears, and now we’re all talking about remodeling our own homes.”
He says they plan to update their bathroom, and maybe even get a hot tub.
“We’re just going to embrace our outdoor space and really just soak it in,” he says.
As far as schooling goes, they’re considering alternatives like charter or magnet schools — options they had not been open to before.
“As this process has gone on, they’ve sort of crept their way onto the table,” he says. “And now we’re fully like, yeah, that’s what we’re going to do. We’ll figure it out.”